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CItii Congress, ) HOUSE OF REPRESENTATIVES. (Doci’mknt 
1st Session . j | No. 1008. 


WATERWAY 


FROM LAKE SUPERIOR TO THE 
MISSISSIPPI RIVER. 


LETTER 

FROM 


YU 2 - 

’&TZ 


THE SECRETARY OF WAR, 

TRANSMITTING 


WITH A LETTER FROM THE CHIEF OF ENGINEERS, REPORT ON 
PRELIMINARY EXAMINATION FOR WATERWAY FROM LAKE 
SUPERIOR TO THE MISSISSIPPI RIVER BY WAY OF ALLOUEZ 
BAY, AT THE EASTERLY END OF THE DULUTH-SUPERIOR HAR¬ 
BOR, AND THE AMNICON, MOOSE, AND ST. CROIX RIVERS, MINN. 
AND WIS.; ALSO A REPORT BY THE BOARD OF ENGINEERS FOR 
RIVERS AND HARBORS, REVIEWING SAID REPORT, AND ALSO 
SUBMITTING ITS VIEWS IN COMPLIANCE WITH A RESOLUTION 
OF THE COMMITTEE ON RIVERS AND HARBORS OF THE HOUSE 
REQUESTING THE BOARD TO REEXAMINE REPORT PRINTED IN 
HOUSE DOCUMENT NO. 304, SIXTY-FIRST CONGRESS, SECOND 
SESSION. 


ArRiL 8, 1916.—Referred to the Committee on Rivers and Harbors and ordered 

to be printed, with illustrations. 


War Department, 

Washing ton, April 6>, 1916. 

The Speaker of the House of Representatives. 


Sir : I have the honor to transmit herewith a letter from the Chief 
of Engineers, United States Army, dated 4th instant, together with 
copy of a report from a special board of officers of the Corps of 
Engineers, dated May 14, 1913, on preliminary examination of water¬ 
way from Lake Superior to the Mississippi River, made in com¬ 
pliance with the provisions of the river and harbor act approved 
July 25, 1912; also copy of report by the Board of Engineers for 
Rivers and Harbors, dated November 9, 1915, made in compliance 
with a resolution of the Committee on Rivers and Harbors of the 
House of Representatives requesting the board to reexamine the 
report on the preliminary examination of this waterway. 

Very respectfully, 

Newton D. Baker, 

Secretary of War , 


p 11 < i 
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Vb 

2 WATERWAY PROM LAKE SUPERIOR TO MISSISSIPPI RIVER. ~ \$ v 

% 

War Department, 

Office of the Chief of Engineers, ^ 

Washington , April J, 1916 . c,o? ! 
From: The Chief of Engineers, United States Army. 

To: The Secretary of War. 

Subject: Preliminary examination of waterway from Lake Superior 
to the Mississippi River. 

1. There is submitted herewith for transmission to Congress re¬ 
port dated May 14, 1913, by a special board of officers of the Corps of 
Engineers, on preliminary examination authorized by the river and 
harbor act approved July 25, 1912, of waterway from Lake Superior 
to the Mississippi River by way of Allouez Bay, at the easterly end 
of the Duluth-Superior Harbor, and the Amnicon, Moose, and St. 
Croix Rivers, Minn, and Wis.; also a report by the Board of Engi¬ 
neers for Rivers and Harbors, dated November 9, 1915, reviewing the 
report of the special board, and also submitting its views in com¬ 
pliance with a resolution of the Committee on Rivers and Harbors 
of the House of Representatives requesting the board to reexamine 
the report on preliminary examination of canal connecting Lake 
Superior and the Mississippi River by way of the St. Croix River, 
Minn, and Wis., printed in House Document No. 304, Sixty-first 
Congress, second session. 

2. In the report referred to in the resolution the route by way of 
Allouez Bay, Brule, and St. Croix Rivers, was considered most 
feasible, but the conclusion was reached that it was not advisable 
for the General Government to undertake the construction of the 
proposed waterway. This route and the one specified in the act of 
July 25, 1912, are identical from Allouez Bay to the Amnicon River 
and from the mouth of the Moose to the Mississippi River. The 
Amnicon-Moose River route, however, has a summit level about 214 
feet higher than the other, or 428 feet of additional rise and fall, 
corresponding to the lift of about 20 locks. Moreover, the special 
board finds that the water supply by this route is insufficient for a 
barge canal, and it therefore expresses the opinion that it is not 
advisable to construct a canal by this route. In reference to the con¬ 
struction of a waterway by way of Brule and St. Croix Rivers, re¬ 
consideration of which is authorized by the resolution of the Com¬ 
mittee on Rivers and Harbors, the special board discusses the benefits 
to be expected and the advantages and disadvantages of such a canal 
as compared with rail transportation under the conditions existing 
at this locality. It reaches the conclusion that the proposed canal 
by way of St. Croix River is not now feasible and practicable, con¬ 
sidering the necessary location, plans, cost of construction, commerce 
affected, and water supply. 

3. The Board of Engineers for Rivers and Harbors, to whom this 
report has been referred, concurs in the views of the special board 
and expresses the opinion that it is not advisable for the United 
States to undertake the construction of this waterway at the present 
time b}^ either of the routes considered. 

4. After due consideration of the above-mentioned reports, I con¬ 
cur in the views of the special board and the Board of Engineers 
for Rivers and Harbors, and therefore report that the construction 
by the United States of a canal or waterway from Lake Superior to 


0. of' O'. 

AUG 19 191(5 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 3 


the Mississippi River, either by way of Allouez Bay, at the easterly 
end of the Duluth-Superior Harbor, and the Amnicon, Moose, and 
St. Croix Rivers, or by way of Allouez Bay, Brule, and St. Croix 
Rivers, is not deemed advisable at the present time. 

W. M. Black, 

Chief of Engineers , United States Army. 


REPORT OF THE BOARD OF ENGINEERS FOR RIVERS AND HARBORS. 

War Department, 

The Board of Engineers for Rivers and Harbors, 

~\V ashing ton, D. C., November 9, 1915. 
From: The Board of Engineers for Rivers and Harbors. 

To: The Chief of Engineers, United States Army. 

Subject: Report relative to waterway from Lake Superior to the 

Mississippi River. 

1. The following is submitted in review of the report of a special 
board on preliminary examination submitted in compliance with the 
following item of the act of July 25, 1912: 

Waterway from Lake Superior to the Mississippi River by way of Allouez 
Bay, at the easterly end of the Duluth-Superior Harbor, and the Amnicon, 
Moose, and St. Croix Rivers, Minn, and Wis., 

also, in compliance with a resolution of the House of Representatives 
dated January 13, 1913, as follows: 

Resolved by the Committee on Rivers and Harbors of the House of Repre¬ 
sentatives, United States, That the Board of Engineers for Rivers and Har¬ 
bors created by section three of the river and harbor act approved June thir¬ 
teenth, nineteen hundred and two, be, and it is hereby, requested to reexamine 
the report on a preliminary examination of canal connecting Lake Superior 
and the Mississippi River by way of the Saint Croix River, Minnesota and 
Wisconsin, printed in House Document Numbered Three hundred and four, 
Sixty-first Congress, second session, and report thereon. 

2. The report referred to in the resolution was submitted under 
the act of March 3, 1909. The route considered therein as most 
feasible was by way of Allouez Bay, Brule and St. Croix Rivers. 
The report was unfavorable. The route to be considered under the 
act of 1912 is by way of Allouez Bay, Amnicon, Moose, and St. 
Croix Rivers. The routes are identical from Allouez Bay to the 
Amnicon River and from the mouth of the Moose to the Mississippi 
River. By the new route, the elevation of the summit level is found 
to be 630 feet above Lake Superior and 565 feet above the Mississippi 
River at the mouth of the St. Croix, a total rise and fall to be over¬ 
come of 1,195 feet, as compared with a summit level of 416 feet above 
Lake Superior and 351 feet above the Mississippi River, a total 
rise and fall of 767 feet by the Brule-St. Croix route. This makes 
a difference in favor of the latter route of about 214 feet in elevation, 
or 428 feet of rise and fall, which would correspond to the lift of 
about 20 locks. The special board also finds that the water supply 
by the Amnicon-Moose River route is insufficient for a barge canal. 

3. In view of these facts, the special board reports that it is not 
advisable to construct a canal by the Amnicon-Moose River route 
specified in the act of 1912. In this view the Board of Engineers 
for Rivers and Harbors concurs. 



4 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

4. The resolution opens up again the question of the advisability 
of constructing a canal by way of the Brule-St. Croix route, as con¬ 
sidered in the report published in House Document No. 304, Sixty- 
first Congress, second session. 

5. The special board considers 3 types of canals, having depths 
and bottom widths as follows: 21 feet by 92 feet, 7 feet by 100 feet, 
and 7 feet by 59 feet, all with termini at the cities of Duluth and 
Superior, on Lake Superior, and St. Paul and Minneapolis, on the 
Mississippi River. As the investigations indicate an inadequate 
water supply for the largest size, a doubtful supply for the inter¬ 
mediate size, but sufficient for the smallest size, further discussion 
is confined to the latter, with a depth of 0 feet, however, to corre¬ 
spond with the project depth of the Mississippi River from the 
mouth of the St. Croix to St. Paul and Minneapolis. This is the 
canal considered in the report under review, the estimated cost of 
which was $7,815,000. The estimate of annual cost is $420,000, 
which includes operation, maintenance, and 3J per cent interest on 
first cost. 

6. The special board finds an estimated present tonnage by rail, 
between Duluth-Superior and the Twin Cities, and moved into and 
out of the eight counties along the canal, as follows: 


Tons. 

Soft coal_ 1,724,000 

Hard coal_ 658, 200 

Iron and steel_ 2, 400 

Flour _ 251, 400 

Grain__ 329,500 

General merchandise_'_ 329, 500 


Total__ 3,295,000 


The amount that would be carried by the canal if constructed is 
purely speculative. In 1880 the Erie Canal carried about 4,600,000 
tons, and in 1906 2,300,000 tons, the latter being about 3 per cent of 
the total tonnage between Buffalo and New York. 

7. An analysis of the cost of transportation by the canal, both to 
the United States and to the carrier, is given as determined under 
various assumptions. The cost to the United States under the im¬ 
probable assumption that the canal will carry all the commerce be¬ 
tween the Twin Cities and Duluth-Superior, would be 13 cents per 
ton, while on the assumption that it would carry 3 per cent of the 
total freight, as in the case of the Erie Canal in 1906, the cost to the 
United States would be $4.25 per ton. On the basis of carrying 18 
per cent of the entire freight, a very liberal assumption, the cost 
would be 71 cents per ton. The cost to the carrier, based on Erie 
Canal experience, would be 78 cents per ton, making the total cost 
in the latter case $1.49. The average rail rate on all commodities 
between the canal termini is about $1.02, showing a probable differ¬ 
ence in favor of the railroads of about 47 cents per ton. The special 
board states that it may be claimed that the total freight will in¬ 
crease and lessen this discrepancy, but it calls attention to the fact 
that between 1880 and 1906 the actual tonnage carried by the Erie 
Canal declined from 18 to 3 per cent of the total between Buffalo 
and New York, while the total tonnage actually increased 200 
per cent. 










WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 5 

8. The special board considers each commodity that may be ex¬ 
pected to use the canal, the probable cost of its transportation by 
canal and by rail, and concludes that practically in every case the 
advantages are in favor of the railroads. 

9. Based upon its investigations and studies, the special board con¬ 
cludes that the proposed canal connecting Lake Superior and the 
Mississippi River by way of the St. Croix River is not now feasible 
and practicable, considering the necessary location, plans, cost of 
construction, commerce affected, and water supply. 

10. Parties in interest were duly informed of the unfavorable re¬ 
port of the special board and given an opportunity of submitting 
statements and arguments bearing upon the subject to the Board of 
Engineers for Rivers and Harbors. This resulted in a request for a 
hearing, which was given at this office on June 30, 1914, and was 
attended by several members of Congress and a delegation of citi¬ 
zens representing the States of Minnesota and Wisconsin. In addi¬ 
tion to oral statements made, a printed appeal containing data and 
representing the views of the Minnesota and Wisconsin Canal Com¬ 
missions was presented. At a later date, a supplemental statement, 
also printed, was received. 

11. The State Canal Commissions differ from the special board in 
some of its figures bearing upon the probable cost of transportation 
by the canal, the cost of handling coal at the terminals and its conse¬ 
quent depreciation, and in some other respects. The views of the 
commissions were brought to the attention of the special board, which 
submitted further observations in reply thereto and stated that it saw 
no reason to modify or change its figures or recommendations. The 
matters in dispute are obviously incapable of precise determination, 
but careful consideration leads this board to believe that the figures 
and estimates of the special board are reasonable and not far from the 
facts. 

12. The question of the advisability of constructing this canal was 
carefully considered in the report now under review. Physical and 
commercial conditions present and prospective were then fully dis¬ 
cussed and the conclusion was reached that the United States would 
not be justified in undertaking the work. An examination of the 
further data now available, including the discussions of the special 
board and the elaborate analysis submitted by the State Canal Com¬ 
missions, fails to indicate any material change in these conditions or 
any sufficient reason for changing the views then expressed. The 
board does not believe that a light-draft canal operating only about 
seven months in the year would divert sufficient commerce from the 
existing well-established lines of transportation to warrant the great 
cost of construction and maintenance and operation. Reference to 
the former reports shows that the estimate of cost for this waterway 
is based on insufficient data, and it is believed by the special board, 
as well as by the Board of Engineers for Rivers and Harbors, to be 
too low. Inasmuch as the inadvisability of investing even this esti¬ 
mated amount in the proposed improvement is evident to the board, 
•the expenditure of the sum necessary for a new survey to obtain a 
more reliable estimate is not recommended. 

13. In view of the foregoing, the board concurs with the special 
board in the opinion that it is not advisable for the United States to 
undertake the construction of this waterway at this time. 


6 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

14. In compliance with law, the board reports that there are no 
questions of terminal facilities, water power, or other related sub¬ 
jects which could be coordinated with the suggested improvement in 
such manner as to render the work advisable in the interests of com¬ 
merce and navigation. 

For the board. 

W. M. Black, 

Colonel , Corps of Engineers , 

Senior Member of the Board. 


PRELIMINARY EXAMINATION OF WATERWAY FROM LAKE SUPERIOR 
TO THE MISSISSIPPI RIVER. 

United States Engineer Office, 

Duluth , Minn., May 11+ , 1913 . 

From: Board of Engineer Officers. 

To: Chief of Engineers, United States Army. 

Subject: Preliminary examination of waterway, Lake Superior to 
the Mississippi River. 

1. The board of officers of the Corps of Engineers, constituted by 
Special Orders No. 19, War Department, Office of the Chief of En¬ 
gineers, Washington, August 14, 1912, for the purpose of making a 
preliminary examination and report thereon for a waterway from 
Lake Superior to the Mississippi River by way of Allouez Bay, at the 
easterly end of the Duluth-Superior Harbor, and the Amicon, Moose, 
and St. Croix Rivers, Minn, and Wis., met January 14, 1913, at Du¬ 
luth, Minn., on the call of the senior member; held a public hearing on 
January 15; and adjourned on the 16th to await further promised in¬ 
formation. The Board again assembled on May 14,1913, at St. Paul, 
Minn., considered further matters, made its report, and adjourned 
sine die. 

2. The board submits the following report: 

3. The river and harbor act of July 25, 1912, provides for the fol¬ 
lowing preliminary examination: 

Waterway from Lake Superior to the Mississippi River by way of Allouez Bay, 
at the easterly end of the Duluth-Superior Harbor, and the Amicon, Moose, and 
St. Croix Rivers, Minn, and Wis. 

4. Previous reports.— Three reports have previously been submit¬ 
ted on the question of a waterway from Lake Superior to the Missis¬ 
sippi River. 

5. The river and harbor act of August 17, 1894, contained the fol¬ 
lowing clause: 

For examination and survey for the location of a canal connecting Lake Su¬ 
perior and the Mississippi River, $10,000; and the engineers making said exami¬ 
nation and survey shall report the most feasible route for such canal, either by 
way of the Saint Croix, Rum, or Upper Mississippi Rivers: Provided, That noth¬ 
ing herein shall be construed to commit the Government to proceed with the con¬ 
struction of said improvement. 

6. This duty was assigned to Maj. Sears, Corps of Engineers, whose * 
report is published in House Document No. 330, 54th Congress, 1st 
session, and also as Appendix HH 12, Report of the Chief of En¬ 
gineers, 1896. In compliance with the wording of the law, which pre¬ 
cluded an opinion as to whether the improvement was commercially 



WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 7 


justifiable or actually feasible; Maj. Sears confined himself to the 
question of relative feasibility and reported that the most feasible 
route for a canal connecting Lake Superior and the Mississippi River 
is from Allouez Bay via the Brule and St. Croix Rivers. 

7. The river and harbor act of March 3, 1899, contained the follow¬ 
ing clause: 

Lake Superior and Mississippi River: The report upon the examination and 
survey for the location of a canal connecting Lake Superior and the Mississippi 
River, provided for by the river and harbor act of eighteen hundred and ninety- 
four-shall be supplemented by a further report as to whether such canal is feasible 
and an improvement which should he undertaken by the Government, and, if feasi¬ 
ble, the probable cost of construction, operation, and maintenance of the same. 

8. This duty was also assigned to Maj. Sears, whose report, supple¬ 
mental to the preceding one, is published in House Document No. 69, 
56th Congress, 1st session, and also as Appendix KK 10, Report of 
the Chief of Engineers, 1900. His conclusion, concurred in by the 
division engineer and the Chief of Engineers, was that the improve¬ 
ment was not one which should be undertaken by the Government. 

9. The river and harbor act of March 3, 1909, contained the fol¬ 
lowing clause: 

The report upon the examination and survey for the location of a canal 
connecting Lake Superior and the Mississippi River by way of the Saint Croix 
River, as provided by the river and harbor act of eighteen hundred and ninety- 
four and as suppplemented by the provisions of the river and harbor act 
approved March thirty-first, eighteen hundred and ninety-nine, shall be com¬ 
pleted by a further report as to whether existing conditions render such project 
now feasible and practicable, considering the necessary location, plans, cost of 
construction and maintenance, commerce affected, and water supply. 

10. The report on this subject was submitted by Lieut. Col. G. D. 
Fitch, Corps of Engineers, under date of August 30, 1909, and is 
printed in House Document No. 304, Sixty-first Congress, second 
session. 

11. The conclusions of the district engineer were as follows: 

In view of the existence of four competing lines of railroad between the 
termini, of the longer route and much longer time of transit for freight, of 
the shortness of the navigation season, of the high cost of construction and 
maintenance, of the very limited amount of probable local traffic, and of the 
uncertainty of any through traffic on the canal if built, I am of the opinion that 
its construction is not worthy of being undertaken by the General Government. 

12. Those of the Board of Engineers for Rivers and Harbors: 

Answering the questions propounded in the act the board reports that in its 
opinion, while existing conditions render such a project feasible and practicable 
from an engineering point of view, the canal is impracticable from a commercal 
viewpoint, when consideration is given to location, plans, cost of construction 
and maintenance, commerce affected, and water supply, and therefore it is not 
advisable for the General Government to undertake the work. 

13. And those of the Chief of Engineers: 

I concur with the district officer, the division engineer, and the Board of 
Engineers for Rivers and Harbors that, while existing conditions render such 
a project practicable, from an engineering point of view, it is commercially 
impracticable, and that it is not now advisable for the General Government to 
undertake the work. 

14. The first act provided for finding the most feasible route from 
Lake Superior to the Mississippi River without considering its 
worthiness. The second act provided for an examination as to 
whether or not the selected route was feasible from a commercial 


8 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

standpoint. It was held not to be. The third act provided for a 
resubmission of the case under possible changed conditions. It was 
still held to be unworthy. 

15. Outline .—The act requiring the present report confines the 
scope of the board to a modification of the Brule-St. Croix route 
which had been previously reported as most feasible. This modifi¬ 
cation consists in following the route via Allouez Bay, the Amnicon 
and Moose Rivers to the St. Croix in place of the Brule and upper 
St. Croix Rivers. Both routes follow the same line from Allouez 
Bay to the Amnicon River and from the mouth of the Moose River 
to the Mississippi River. Attention is invited to the accompanying 
map and profile and particularly to report (Appendix A) of Junior 
Engineer G. A. Taylor, who was in charge of the field party gather¬ 
ing information and data for the new portion of the route. Some 
of the conclusions stated are taken from Mr. Taylor’s report direct. 

16. Description of the route. —Beginning at the eastern end of 
Allouez Bay in Duluth-Superior Harbor; thence for a distance of 
5J miles in an easterly direction to the Amnicon River, at an elevation 
of 61 feet; thence for 14^ miles up the Amnicon River to a point 582 
feet above Lake Superior; thence for 6 miles south across the divide, 
which is 630 feet above Lake Superior, to the Moose River; thence 

9 miles down the Moose to the St. Croix River, 385 feet above Lake 
Superior; and thence down the St. Croix for 149J miles to its junc¬ 
tion with the Mississippi River, 65 feet above Lake Superior. 

17. The total rise from Lake Superior to the summit is 630 feet, 
and this point is 565 feet above the Mississippi at the mouth of the 
St. Croix, making a total rise and fall of 1,195 feet to be overcome 
between Lake Superior and the Mississippi River. 

18. Water supply. —By reason of its primary importance the 
question of water supply for the summit level of the proposed canal 
was given particular attention. 

19. The examination by Mr. Taylor, fully described in his accom¬ 
panying report with maps 1 and profile, shows the summit level for 
the crossing from the Amnicon to the Moose River, to have an avail¬ 
able watershed of only 65 square miles sufficient with average rain¬ 
fall to furnish a flow of 93 second-feet for six months in the year. 
A recent investigation of the run-off of the whole St. Croix Valley 
above St. Croix Falls shows that for a year of practically normal 
rainfall (the discharge being measured continuously by the electrical 
power generated) there was 22.6 per cent run-off. This, with Mr. 
Taylor’s estimate of 30 inches rainfall, would amount to 6f inches 
instead of his 0.8 foot, showing that his figure is not too small. 

20. Outside this limited watershed the land slopes away, and no 
opportunity was found for a feeder to augment the summit supply. 
The summit is about 200 feet above the headwaters of the St. Croix 
on the east, and 50 to 70 feet above the Black River on the west. By 
a computation similar to that followed on pages 13 to 18, House Doc¬ 
ument No. 330, Fifty-fourth Congress, first session, it is found that 
the summit level water supply for a barge canal must be 210 second- 
feet, if 40 lockages are made per day. Mr. Taylor estimates the 
available supply at 93 second-feet, and that is probably large. 


1 Only one map and profile printed. 




WAR DEPARTMENT. 


CORPS Of ENGINEERS, U S , ARMY. 



THc. NORRIS PETERS CO.. WASHINGTON, D. C 


House Doc. No. 1008; 64th Cong., 1st Sess. 














































































WAR DEPARTMENT. 





















































































































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THE NORRIS RfTERS CO., WASHINGTON. D. C. 







































































































CORPS OF ENGINEERS, U. S. ARMY. 



House Doc. N 0 ./OO 6 ; 64th Cong., 1 st Sess 



















































































































































WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 9 


21. Conclusion. —The board therefore feels justified, without 
further discussion, in stating the following facts and conclusions: 

(a) A feasible route from the engineering standpoint had already 
been found for a canal connecting Lake Superior and the Mississippi 
River via the Brule and St. Croix Rivers. 

(b) The route prescribed in the act of July 25, 1912, adds the 
difficulty of about 210 feet additional height of summit level, calling 
for probably 20 more locks. 

(c) The Amnicon and Moose Rivers carry much less water than 
the Brule and upper St. Croix and therefore the possible water¬ 
power development would be smaller. 

(d) The Amnicon River is much less favorable to canalization 
than the Brule. (See Appendix A.) 

( e ) Even with a limited use of the canal (40 lockages per day) 
the natural water supply available to the summit level is not half 
enough, and to provide the necessary water, expensive pumping 
plants must be furnished and operated. 

(/) The small local population which could be benefited by the 
canal is along the Brule and St. Croix rather than along the Amnicon 
and Moose. 

( g) The only advantage to offset these disadvantages is a reduc¬ 
tion in length of 25J miles. 

( h) The disadvantages far outweigh the advantages. 

( i) The route specified in the act is not feasible from an engineer¬ 
ing standpoint. 

(j) The locality in question is not worthy of improvement by the 
General Government. 

22. The Committee on Rivers and Harbors of the House of Repre¬ 
sentatives passed on January 13, 1913, the following resolution: 

Resolved by the Committee on Rivers and Harbors of the House of Repre¬ 
sentatives, United States, That the Board of Engineers for Rivers and Harbors 
created by section three of the river and harbor act approved June thirteenth, 
nineteen hundred and two, be, and it is hereby, requested to reexamine the 
report on a preliminary examination of canal connecting Lake Superior and 
the Mississippi River by way of the Saint Croix River, Minnesota and Wiscon¬ 
sin, printed in House Document Numbered three hundred and four, Sixty-first 
Congress, second session, and report thereon. 

23. On January 23, 1913, the Chief of Engineers referred the reso¬ 
lution to this board for consideration and report. This is assumed to 
open up the whole question of advisability of a canal connecting 
Lake Superior with the Mississippi River via the Brule and St 
Croix Rivers. 

24. Route. —The route to be considered is that via the Brule and 
St. Croix Rivers and described in House Document No. 304, Sixty- 
first Congress, second session, as follows: 

By this route the northern terminus of the proposed waterway is Bear 
Creek on Allouez Bay, the southeasterly portion of Duluth-Superior Harbor. 
Thence for a distance of 21.58 miles in an east-southeasterly direction there is 
a canal link to the Brule River 356 feet above Lake Superior. The canalized 
Brule River is then followed for 10 miles to the summit level, which is 416 
feet above Lake Superior and 351 feet above the Mississippi at the mouth of 
the St. Croix. This level follows the general direction of the Brule River and 
finally, through a short excavated trench, reaches upper Lake St. Croix, 12.73 
miles from the north summit lock. About 20.77 miles below the northerly end 
of upper Lake St. Croix is the south summit lock. Thence the route is along 
the canalized St. Croix River for about 17 miles to a point about one-half 


10 WATER W/JX FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


mile below its confluence with the Namakagan River.. Thence slack-water 
navigation is proposed for the St. Croix River and St. Croix Lake to the south¬ 
ern terminus, Point Prescott on the Mississippi River, 30 miles below St. 
Paul, except that two short canal links will be required, one 5 miles long around 
Kettle Rapids and one 8,000 feet long at Taylors Falls. The total length of 
the waterway by this route is 210 miles, and the total lift (up and down) is 
7G7 feet. This may safely be considered the most feasible route; otherwise 
another survey would be required, and it is not probable that such survey would 
result in the recommendation of any material change in the location of the 
canal. 

25. Size of canal .—Throe kinds of canal have been considered—a 
ship canal, a steamboat canal, and a barge canal. One of the most 
important considerations in a canal is the supply of water to the sum¬ 
mit level which is drawn upon for operation whenever lockages are 
made, and by evaporation, leakage, and filtration at all times. A care¬ 
ful discussion of the water available to the summit level of this 
canal was made by Lieut. C. H. McKinstry, Corps of Engineers, in 
1895, and published as Exhibit H of report of Maj. Sears in House 
Document No. 330, Fifty-fourth Congress, first session. The con¬ 
clusion was reached that the summit level supply was entirely in¬ 
adequate for a ship canal, probably inadequate for a steamboat canal, 
but sufficient for a barge canal of the dimensions suggested. 

26. At the public hearing January 15, 1913, many depths were 
suggested—8, 10, 12, and 14 feet. The junction of this canal with 
the Mississippi River can not be considered as in any sense its com¬ 
mercial terminus. At that point is the small toAvn of Prescott, Wis. 
(population about 1,000), and a few miles up the river the town 
of Hastings, Minn, (population about 4,000). Neither of these is 
likely to become a large railroad center. The object of the canal is 
to obtain through water transportation from Lake Superior to St. 
Paul and Minneapolis and to points lower down on the Mississippi 
River. The existing project for navigation of the Mississippi River 
from Minneapolis to St. Louis provides for 6 feet at low water, 
and there is little prospect of any increase in this project depth. 
It can scarcely be argued that a transshipment would be made at 
Duluth from lake vessels (for which no canal can be built on 
account of lack of water at the summit level) to deep-draft barges 
for the canal, and another transshipment at Prescott to the shallow 
barges which must finish the trip to any large market or center 
of population. 

27. It. should thus be definitely settled that a ship canal from 
Lake Superior to the mouth of the St. Croix River is out of the 
question, and that, for any future time which the board considers 
within reason, the depth for a canal should be that now fixed by the 
upper Mississippi River project, or 6 feet, and no more. 

28. It then becomes a question between a steamboat canal and a 
barge canal. With the water supply at the summit level very doubt¬ 
ful for a steamboat canal, and with no estimate of the cost of such 
a canal, the discussion will be primarily confined to a barge qanal of 
6 feet depth, with 16 locks and 8 hydraulic lifts, 59 feet bottom 
width, and 80 feet top width, and locks 170 by 35 feet with 6 feet of 
water on the miter sills. This is the canal discussed in House Docu¬ 
ment No. 304, Sixty-first Congress, second session. 

29. Cost .—Such a canal was estimated in 1909 to cost $7,815,000 
for construction, and $420,000 per year for operation, maintenance, 


WATERWAY FROM LAKE SUPERIOR TO MISSISS PI RIVER. 11 


and 3J. per cent on investment. There is certainly no change in con¬ 
ditions in the past three and one-half years which would warrant a 
reduction in these estimates. They will be accepted, but if any doubt 
exists it must be as to their being high enough. 

30. Problem .—Will the saving in freight to the public, on the prob¬ 
able commerce through the canal be equal to the $420,000 annual ex¬ 
pense to the Government for operation, maintenance, and interest 
on the investment? 

31. Prospective commerce .—At the request of the board the Minne¬ 
sota Railroad and Warehouse Commission has furnished statistics 
of the amount of such material as might go by water, hauled during 
the year ending June, 1912, by the four railroads connecting Duluth- 
Superior with Minneapolis and St. Paul. 


Name of road. 


Great Northern Railway Co. 

Northern Pacific Railway Co. 

Chicago, St. Paul, Minneapolis & Omaha Railway Co 
St. Paul, Minneapolis & Sault Ste. Marie Railway Co. 

Grand total. 


Hard and 
soft coal 
and struc¬ 
tural iron 
shipped 
from Du¬ 
luth, Minn., 
and Supe¬ 
rior, Wis., 
to St. Paul, 
Minn. 
Transfer 
and Minne¬ 
apolis. 

Flour 

shipped 

from 

St. Paul, 
Minn. 
Transfer 
and Min¬ 
neapolis, 
t.0 

Duluth, 
Minn., 
and Supe¬ 
rior, Wis. 

Short tons. 

Short tons. 

694,115 

106,570 

1,089,105 

112,330 

138,321 

3,554 

33,027 

716 

1,954,568 

223,170 


32. From reliable estimates furnished by railroad authorities it 
appears that the above freight is about 80 per cent of the total freight 
handled by the roads, the balance being grain and general merchan¬ 
dise or package freight. The table carries only the bulk freight. 

33. As to the amount of local freight which would be handled 
by the canal, the following table shows the number of inhabitants 
in the counties which the canal would pass through or touch: 


County and State. 

Square 

miles. 

Popula¬ 
tion, 1908. 

Popula¬ 
tion, 1910. 

Dnugl a<? Wis (Avolnsive of Superior)... 

1,289 

881 

1,444 

452 

933 

430 

711 

543 

5,115 
9,261 
i14,869 
i14,341 
20,885 
128,884 
26,716 
23,433 

7,038 
9,026 
15,878 
12,537 
21,367 
26.013 
25,910 
22,079 

Burnett, Wis. 

Pine Minn. 


Poik Wis . 

Washington, Minn. 

St Croix, Wis . 

Pierce Wis . 

Total ......... 

6,683 

143,504 

140,848 



1 Figures for population for 1905. 


34. This table shows that three counties have increased in popu¬ 
lation, five have decreased, and the entire district has lost in popula¬ 
tion during the period from 1905 and 1908 to 1910. From this it is 
evident that the country is not at present a growing community, 
while the cities at the extremities of the line are. The density of 
































12 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


population in the canal counties is 21 per square mile, while that of 
the entire United States in 1910 was nearly 26 per square mile. 

35. The population of the cities at the termini of the canal in 1910 
was as follows: 


Duluth_ 

Superior_ 

St. Paul_ 

Minneapolis. 


78, 466 
40, 384 
214, 744 
301, 408 


Total___ 635,002 

36. The population of the canal counties (and many of the inhabi¬ 
tants of these counties could not use the canal) is approximately 22 
per cent of the population of the terminal cities. 

37. The canal will be discussed under the assumption that it is 
to be a waterway between the Twin Cities and the head of the lakes 
and will also serve the local population between the head of the 
lakes and the mouth of the St. Croix River. The freight between 
the terminal cities is large and serves a large population beyond the 
Twin Cities. For example much of the coal from Duluth-Superior 
to St. Paul-Minneapolis goes southward and westward to many 
small towns. To increase the estimate of shipments of coal by 
22 per cent on account of the local population along the canal, favors 
the canal more than it deserves, but such increase will be assumed, 
since the actual population to be served by the canal is unknown; 
the population of the Tw r in Cities is the only figure available and 
represents the minimum to be served at the southern end. 

38. The freight which may come from the east via the lakes and 
go to points south of the mouth of the St. Croix River along the 
Mississippi River is limited. La Crosse, Wis., and Winona, Minn., 
are the first cities of importance and their combined population is 
only 8 per cent of that of St. Paul and Minneapolis. Besides, they 
are probably in Chicago territory rather than in Duluth-Superior 
territory, even if the canal be built. The assumed basis is therefore 
probable more than fair to the canal. 

39. The railroads were requested to separate the figures furnished 
by the Railroad and Warehouse Commission showing the bulk freight 
hauled from Duluth-Superior to the Twin Cities so as to give data 
as to what part of the total freight was represented by soft coal, hard 
coal, and iron. The responses show that, of the 1,954,458 tons; 

Per cent. 


Soft coal represented___ 72 . 3 

Hard coal represented_27. 6 

Iron and steel represented_ * 1 


40. The added 22 per cent for local population along the canal 
increases the estimate of shipments southward of bulk goods from 
1,954,568 to 2,384,573 tons. Applying the above percentages we find 
approximately: 

Soft coal-1- 1,724 S *000 

Hard coal- 658,200 

Iron and steel_ 2 400 

41. The 22 per cent increase can not materially affect the flour 
figures, but the total will be 251,400 tons (allowing a soldier’s ration 
of 18 ounces per day to every individual in the eight counties). This 
makes the grand total of bulk freight 2,636,000 tons. Railroad people 














WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 13 

estimate that this represents 80 per cent of the entire freight ship¬ 
ment. It is not unreasonable to assume that the other 20 per cent, or 
659,000 tons, is divided equally between grain and general merchan¬ 
dise. As nearly as we can estimate the actual figures, the total freight 
for the fiscal year 1912 moved between Duluth-Superior and the 
Twin Cities and moved into and out of the eight counties along the 
canal would be: 



Tons. 

Percent¬ 
age of 
total 
freight. 

Soft coal. 

1,724,000 
658,200 
2,400 
251,400 
329,500 
329,500 

52.3 

Hard coal. 

20.0 

Iron and steel. 

0.1 

Flour. 

7.6 

drain. 

10.0 

General merchandise. 

10.0 


Total. 

3,295,000 

100.0 



42. How much of this would the canal probably carry? The Erie 
Canal in 1880 carried 4,608,581 tons, or 18 per cent of the total freight 
moved by rail and canal between Buffalo and New York. In 1906, 
the last year for which statistics are available, we find that the canal 
carried 2,385,491 tons, an actual decrease in freight handled of nearly 
50 per cent, and of the total freight carried between Buffalo and New 
York the canal carried only 3 per cent. It had then lost one-half of 
its actual traffic and had dropped from 18 per cent to 3 per cent in 
its proportion of the total freight carried between Buffalo and New 
York. 

Freight shipped by Mississippi River system. 



Tons carried. 

Loss. 


1889 

1906 


Upper Mississippi . 

3,947,364 
180,264 
2,132,820 

595,885 

105,826 

1,056,390 

Per ct. 
85 

Illinois River . 

41 

Missouri unci tributaries abov6 St, Tbouis 

50 


Total upper river . 

6,360,448 

15,796,968 

1,758,101 
15,226,805 

72 

Ohio River. 

4 

Lower Mississippi.... 

6,232,087 

2,546,187 

59 



Total Mississippi River.. 

28,289,503 

19,531,093 

31 



44. The Erie Canal is the best waterway for comparison with the 
proposed canal. Both are in a region where navigation is closed 
for several months by climatic conditions, and both are dependent 
upon and become a part of the traffic of the Great Lakes. Both are 
paralleled by many efficient and competing railroads, some inter¬ 
state and some intrastate. 

45. Cost of transportation by canal .—This subject will be taken 
up under two headings, (a) cost to the United States and (b) cost 
to water carrier. For the purpose of discussion several cases will 
be assumed: (1) That the canal operating for seven months of the 
year will carry all the present freight, or 3,295,000 tons; (2) that 
the canal, will carry 50 per cent of the entire freight, or 1,647,500 































14 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

tons; (3) that the canal will carry 18 per cent of the entire freight, 
as the Erie Canal did in 1880, or 593,100 tons; (4) that the canal 
will carry 3 per cent of the entire freight, as the Erie Canal did in 
1906, or 98,850 tons; (5) that the canal will carry all freight except 
coal; (6) that the canal will carry all freight except soft coal; (7) 
that the canal will carry all grain and flour northward and all hard 
coal southward. 

(a) Cost to the United States .—The canal to be commercially jus¬ 
tified must save to the public at least $420,000 per annum, an amount 
equivalent to a reduction of the selling price of the freight handled 
under the various conditions, as follows: 


Per ton. 

(1) 3,295,000 tons_1_$0.13 

(2) 1,647,500 tons_ .25 

(3 ) 593,100 tons_ .71 

(4) 98,850 tons_4.25 

(5 ) 912,800 tons_ .46 

(6) 1,571,000 tons_ .27 

(7) 1,239,100 tons_ .34 


(b) Cost to water carrier .—In discussing this feature it is neces¬ 
sary to note a circumstance which works greatly against the canal. 
Duluth-Superior Harbor does an immense business in both receipts 
and shipments. For the calendar year 1911, the total receipts were 
9,424,962 tons, of which 8,434,905 tons (or practically 90 per cent) 
was coal. All of Duluth-Superior’s receipts by Lake, except a few 
minor items, are such that their proper quota would be sent to St. 
Paul and Minneapolis. The Lake shipments from Duluth-Superior 
in 1911 were 21,247,884 tons, of which 19,014,620 tons (90 per cent) 
were iron ore, practically none of which could use the canal; 809,000 
tons were wheat, of which, it will be shown later, a small amount 
passes through the Twin Cities and practically none would use the 
canal; 232,000 tons of oats, barley, and corn, of which a portion might 
use the canal; 431,200 tons of flour, of which one-half (see figures of 
State Railroad and Warehouse Commission) originates in Minne¬ 
apolis and might use the canal. Of all the Lake shipments from 
Duluth-Superior (see Annual Report of the Chief of Engineers for 
1912, p. 2461) there is little that can be claimed for the canal except 
probably one-half of the 431,200 tons of flour and a portion of the 
232,000 tons of oats, barley, and corn. Probably nine-tenths of the 
general merchandise carried between the two termini moves south¬ 
ward. In the figures given by the Stillwater people in 1909 (H. 
Doc. No. 304, 61st Cong., 2d sess.) they mention 120,000 tons 
of general merchandise southbound and do not even mention it in 
the northbound statistics, but there may be a small amount in the 
“ 57,000 miscellaneous ” northbound. Thus it appears that 500,000 
tons would be a large figure for available freight to Duluth-Superior, 
while the available return freight would be more than 2,000,000 
tons. It must therefore be concluded that of every four barges tak¬ 
ing freight to the Twin Cities, at least three must return to Duluth 
empty. The latest available figures showing average freight rates on 
the Erie Canal was 3 mills per ton-mile, as given by the Interstate 
Commerce Commission (Railways in the United States in 1902, pt. 
2, A 40-year review of changes in freight tariffs, Washington, D. C.. 
1903). 5 









WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 15 

46. The entire distance from the Duluth-Superior Harbor to Min¬ 
neapolis is about 260 miles, giving 78 cents as a payment to the 
water carrier on the same basis as the Erie Canal rates. It might 
be claimed, and justly, that the single-barge method, or that of one 
barge towing another, is unduly expensive between Taylors Falls 
and St. Paul. A fleet made up and towed by a single steamer is the 
economical method on an open waterway, but it would undoubtedly 
be more expensive to make the change. The delay to the steamer in 
waiting for and making up a tow could not be avoided unless the 
barges had to do the waiting, and if either waits there is a loss. 
While the steamer is towing the fleet to and from Minneapolis the 
barge crews would be idle. The only expense of the single barge 
over the fleet would be a little loss of economy in fuel and a little 
longer time in making the run. These would not cover the cost of 
the tow boat, with its necessarily lost time. The single barges, or one 
towing another, would undoubtedly complete the trip at both ends of 
the waterway without assistance and the Erie Canal rate should 
apply for the entire 260 miles, amounting to 78 cents per ton. 

47. But it is improbable that the Erie Canal boat has to go back 
empty three trips out of four. The commodities to be shipped in that 
section are not so unbalanced in the two directions as they are between 
the Twin Cities and Duluth-Superior. In the case of the Erie 
Canal general merchandise is likely to be going in either direction; 
machinery and structural iron may be going in either direction; 
and the chances of a return cargo are much better than one in four. 
It would therefore appear that with the one-way traffic between the 
Head of the Lakes and the Twin Cities, the Erie Canal rate would 
be none too large and very probably too small. 

48. If the two costs now be added there will result: 


Case. 

Canal carrying— 

Cost 

to 

United 

States. 

Cost 

to 

shipper. 

Total. 

j 

100 per cent. 

$0.13 
.25 

$0. 78 
.78 
.78 
.78 
.78 
.78 
.78 

JO. 91 
1.03 
1.49 
5.03 
1.24 
1.05 
1.12 

2 

50 per cent. 

3 

18 per cent. . . 

.71 

4 

3 per cent. 

4. 25 
.46 
.27 

5 

All but coal. 

6 

All but soft coal. 

7 

Hard coal, grain, and flour. 

.34 




49. Railroad rates .—Between St. Paul and Duluth, January, 1913, 
per ton of 2,000 pounds: 

Coal, hard_$1.25 

Coal, soft- . 90 

Wheat_ 1. 00 

Flour_ 1. 00 

Coarse grain_ 1. 00 

Lumber_ 1. 20 

Structural iron_ 1. 50 

Building stone_ 1. 00 

Iron castings_ 2. 00 

Cement_ 1. 00 

50. These are the rates between the two cities, but not the rate paid 
by the St. Paul and Minneapolis merchant on general merchandise 
which he receives through Duluth and Superior from the east. The 
“package freighters” on the Great Lakes are generally railroad- 


Iron (bar or band)_$1.50 

Iron, pig- 1.12 

Lime- 1. 20 

Rails_ .90 

Salt_ 1.00 

Sand_ 1. 00 

Stone_ a_ 1. 00 

Stone, crushed_ . 80 

Sugar_ 1. 60 




































16 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


owned boats and the Twin City merchants get a “ lake-and-rail ” 
rate from the east to the Twin Cities, which gives them the advan¬ 
tage of a very low rate from the Head of the Lakes. This matter is 
now before the Interstate Commerce Commission on complaint of the 
business organizations of Duluth-Superior that it allows the Twin 
City merchant to receive merchandise and ship it back over the same 
lines to smaller towns more cheaply than the Duluth-Superior mer¬ 
chant can reach the same towns. This condition has existed many 
years and may or may not persist, but we will continue the discus¬ 
sion on the basis that the Twin City merchant may have to pay the 
rates above stated. 

51. Having determined the average rate on the canal it remains to 
determine the average railroad rates on all commodities. The aver¬ 
age rail rate for iron may be taken as the average rate on the five 
kinds, or $1.40. The general merchandise rate may be taken as the 
average on stone, cement, lime, salt, and sugar, or $1.16. The average 
rate on all freight may thus be determined: 



Tons. 

Rate. 

Amount. 

Soft coal. 

1,724,000 
658,200 
2,400 
251,400 
329,500 
329,500 

$0.90 
1.25 
1.40 
1.00 
1.00 
1.16 

$1,551,600 
822,750 
33,600 
251,400 
329,500 
382,220 

Hard coal. 

Iron and steel. 

Flour. 

Grain. 

General merchandise. 

Totals. 

3,295,000 


3,371,070 




3 371 070 

3 295 bd b~$1.0^, ^ ie avera g e ra il rate on all commodities. 

If the canal rate of 78 cents be subtracted from this rail rate it gives 
24.4 cents as the difference which may go to reimburse the United 
States for its expenditure. This practically corresponds to case (2) 
above, which means that the canal must haul 50 per cent of all freight 
in order to equal railroad rates and make good the Government’s 
outlay. 

52. Comparison .—The canal, in order to transport as cheaply as 
the railroads, must handle annually 1,647,500 tons, or 50 per cent of 
the traffic for the fiscal year 1912. It may be claimed that the total 
freight will increase from year to year and a reduced percentage will 
keep up the actual tonnage. This is undoubtedly true if the canal can 
obtain and keep up 1,467,500 tons per annum. It has already been 
pointed out that between 1880 and 1906 the actual tonnage carried by 
the Erie Canal reduced one-half and its proportional tonnage reduced 
from 18 per cent to 3 per cent. Thus, while the total tonnage between 
Buffalo and New York was increased 200 per cent, the actual tonnage 
carried by the canal was reduced 50 per cent. History does not favor 
the claim made by its advocates that the canal may not be commer¬ 
cially feasible now, but that, when commerce develops, it will be a ne¬ 
cessity. If it can not compete now, there is little hope for the future. 

53. In order to compete with the railroads the canal must either re¬ 
duce the rates, give better service, or both. A reduction of 10 cents 
per ton in freight rate will not, with our present business methods, 
offset much inadequacy of service. It will scarcely be claimed that 
the canal can give better service than the railroads and it must there¬ 
fore give better rates. It has been shown that it must handle 50 per 


















WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 17 


cent of the present commerce in order to equal the rail rates. It must, 
in order to reduce the rates an average of 12 cents per ton (average 
rail rate $1,024, minus case 1, $0.91), carry the present entire ton¬ 
nage ; must carry it all in an open season of seven months; and must 
give a service equal to that of the railroads. 

54. The various commodities will be taken up to show why the 
canal will or will not carry them. In these discussions figures and 
estimates are taken indiscriminately from previous reports and from 
the remarks of Mr. Barnes made at the public hearing (Appendix B) 
and the papers of Messrs. Little (Appendix C) and Hall (Appen¬ 
dix I)) and Citizens Canal Association of Stillwater, Minn. (Ap¬ 
pendix E). It will be impossible to note the reference in all cases. 

55. Coal .—Of all the traffic between the Head of the Lakes and the 
Twin Cities, 72 per cent is coal. Of this, 72 per cent is soft coal and 
28 per cent is hard coal. Duluth and Superior are the coal yards of 
the Northwest, and particularly of St. Paul and Minneapolis. They 
are at the head of a system of deep-water navigation which reaches so 
near the eastern coal fields that the railroad haul from those fields to 
Lake Erie is short. They have a large harbor, with little fluctuation 
in water level, with flat shores, and with shallow water near the, 
shores, affording excellent opportunities for large coal docks, where 
coal is handled by the most modern machinery from the large lake 
vessel to the docks on which it is stored ready for shipment to the 
consumer. When called for it is screened, loaded on cars in the 
same economical manner, and shipped out. Contrast these conditions 
with those to be found at St. Paul and Minneapolis. The Mississippi 
River between and including the two cities is in a gorge giving no 
room for large coal yards in the bottom lands and with few points 
where railroads can handle a large coal business between the river 
and the cities. The city of St. Paul is now contemplating changing 
the course of the Mississippi River so as to make room for a union 
station for passenger service. The fluctuation of the river at St. 
Paul is about 20 feet, and at Minneapolis it will be about 8 feet after 
the dam is completed. The conditions are not unlike those at Cin¬ 
cinnati except that the fluctuation of the river at that place is nearly 
70 feet. On a fluctuation even as small as that in Minneapolis or 
St. Paul, the same kind of machinery for unloading coal will bo 
needed, the same amount of labor will be necessary; the same diffi¬ 
culties in clamshelling the coal in the barge will be encountered, 
and the cost can not be much less. Regarding the cost of unloading 
barges at Cincinnati, the superintendent of the chamber of commerce 
wrote: 

Cincinnati, June 26, 1900. 

Dear Sir: In reply to yours of June 23, we have pleasure in inclosing tables 
showing the receipts here of coal for a series of years, indicating quantities 
by river and by rail and sources of supply. 

The rail freight rate on coal from Kanawha region to Cincinnati is $1 per ton. 
This relates to coal destined for delivery in this market; shipments made to 
points beyond this market have a joint rate understood to be on a lower basis. 

By river, the freight rate is 50 to 62* cents per ton; additional to this is the 
cost of elevating from barges to elevators to get the coal in position for de¬ 
livery on track for shipment, or to be otherwise distributed. This represents 
25 to 35 cents per ton, so that the river freight plus elevating is practically 
the same as the rail rate. 

Yours, truly, 


H. Doc. 1008, 64-1-2 


C. B. Murray, Superintendent. 


18 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

56. The tables 1 referred to in the letter show that in 1896 the river 
receipts were about 59,000 tons and the rail receipts were about 
21,000 tons (26 per cent), while in 1908 the river receipts were about 
36,000 tons and the rail receipts were about 85,000 tons (TO per cent 
on 50 per cent greater total receipts). The actual amount delivered 
by river in 1908 was only 60 per cent of that in 1896. This shows 
that we must allow a cost of at least 25 cents for every ton of coal 
delivered from the river at Minneapolis and St. Paul and further 
indicates that the railroads are running the Ohio Iiiver, the greatest 
coal river in the world, out of the coal business, on a haul of 200 to 
300 miles, although the actual difference in freight rate in favor of 
the water haul is 3T| to 50 cents. With regard to the item of 25 
cents for unloading coal at the river bank, it may be stated that the 
unloading at Cincinnati is done from barges entirely open. If such 
barges be used for coal on the proposed canal they would be entirely 
unfit for the carrying of any possible return freight. If the barges 
be decked, as they must be for handling grain or flour, the unloading 
of coal would be more expensive. 

57. For the sake of comparison we may assume that the coal can be 
put into barges at the vessel’s side in Duluth Harbor as cheaply as 
it can be put on the wharf at Duluth-Superior. This is very doubtful 
when we compare the modern machinery used at the large coal docks 
with a floating conveyor and when we consider the advantage of 
dumping in large piles over stowing in barges. The coal is then on 
its way to St. Paul, via the canal, at the same cost that it would have 
represented on the dock at Duluth. It must pay the canal freight 
rate and a cost of 25 cents per ton to unload it on the river bank in 
St. Paul. This unloading operation gives it an extra handling with 
a clamshell bucket. It is now in the same condition with respect 
to delivery to the consumer that it is on the dock at Duluth, ready 
to be screened and delivered. The large coal dealers place a mininum 
deterioration of 25 cents per ton as the result of breakage in each 
handling of coal such as is necessary in unloading from the barges 
at the river bank. The coal is now on the river bank and has cost 
the wholesale dealer the same that it would on the wharf at Duluth, 
plus the canal freight rate, plus 25 cents for unloading and elevating, 
and plus 25 cents by deterioration in unloading. This 25 cents for 
breakage is probably the explanation of the fact that Cincinnati 
prefers to get its coal by rail rather than by river. 

58. The coal has to be screened and delivered to the carload con¬ 
sumer and to the local coal yard just as at present it has to be, from 
the coal dock at Duluth or Superior. In those cities the charge and 
cost of carload deliveries to large consumers and to retail yards is 25 
cents per ton, and there is no reason to believe that it would cost less 
in St. Paul. 

59. The cost of coal to the wholesale consumer or retail dealer in 
the Twin Cities must be either— 

(a) By rail: The cost of the coal on the lake vessel in Duluth- 
Superior, plus the cost of unloading, screening, and loading, plus the 
railroad rate (90 cents for soft and $1.25 for hard), and plus the 
dealer’s profit; or 


1 Not printed. 




WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 19 


(b) By canal: Every item the same, except that for railroad rate 
there must be substituted canal rate plus 75 cents for unloading, 
breakage, and delivery. 

60. It therefore appears that the dealer can afford to pay a canal 
rate of 15 cents per ton on soft coal and 50 cents per ton on hard coal. 
This actual rate on the Erie Canal basis should be 78 cents. In these 
figures there is no return to the United States on its investment. 

61. This discussion presumes that the wholesale dealer in the Twin 
Cities can practically supply everybody largely in the open season 
of navigation. To keep any large stock during the closed season he 
would require more storage room than can be had on the river, and 
in that case another storage yard will be necessary, requiring an 
additional handling and hauling to that yard and the rent of such 
a yard, for all of which the consumer must pay. It may be argued 
that the cost to the consumer would be reduced by avoiding this ad¬ 
ditional yard and that he will stock up for the winter. Such an 
argument is futile. Even though the consumer may know the con¬ 
ditions, he, either from necessity or from a preference for seeing the 
coal merchant’s money rather than his own tied up in his needed 
supply, will order his coal as he wants it throughout the winter 
season. As that is the season of greatest consumption in all lines, 
there is little doubt that one-half the coal consumed in St. Paul and 
Minneapolis will require the extra handling and hauling and the 
extra storage yard away from the landing place on the river bank. 

62. If cost does not favor the canal, and it does not, we must look 
to service. Any consumer or dealer in St. Paul or Minneapolis can 
order from a coal company a carload of coal one morning and gener¬ 
ally he will have it at his door or yard the next morning, and cer¬ 
tainly the second morning with delivery made from Duluth or 
Superior. He could not get it much more quickly if delivery were 
made from stock in his own city. 

63. Duluth-Superior is the natural and economical coal yard for 
St. Paul and Minneapolis. 

64. Much of the coal coming to St. Paul and Minneapolis is for 
railroad use, and would naturally be hauled by the roads themselves. 

65. The coal used for Government purposes in the Twin Cities 
will not move by the canal, as there is a land-grant rate of 50 per 
cent on Government freight. 

66. It can be safely stated that the consumer or retail dealer is 
not going to buy coal from the Minneapolis or St. Paul wholesale 
dealer through sentiment rather than from the agent of the Duluth 
or Superior dealer when he can get the same coal with good service 
from the latter at a considerably lower figure. 

67. The canal will not, if built, move coal from the head of the 
Lakes to the Twin Cities. Coal is 72.3 per cent of the traffic between 
Duluth-Superior and St. Paul-Minneapolis, leaving 27.7 per cent, 
or 912,800 tons, for the canal. With this amount of freight the cost 
of transportation to the United States becomes. 


420,000 

912,800 


=46 cents. 


68. This, added to 78 cents for freight by the canal, gives $1.24 
as the cost of transportation. The average railroad rate on the same 



20 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


commodities is $1.09. Therefore the canal can not carry the coal and 
can not exist on all other freight combined. 

GO. Various statements have been made as to the percentage of 
the coal received at Duluth-Superior which goes to St. Paul, Min¬ 
neapolis, and the Minnesota Transfer. In the fiscal year 1912 the 
railroad figures show the latter to be— 

Tons. 

Soft coal_1, 724, 000 

Hard coal_ 658, 200 


Total_ 2,382,200 

In the same fiscal year the receipts at Duluth-Superior were: 



Tons. 

Percentage 
to the 

Twin Cities. 

Soft coal. 

7,115,831 

24 

Hard coal. 

1,255,330 

52 

Total. 

8,371,161 

28 




Since little of the 1912 receipts would move to the Twin Cities 
before June 30, it would probably be better to take the receipts at 
Duluth-Superior for the calendar year 1911 and compare them with 
the Twin Cities receipts for the fiscal year 1912: 



Tons. 

Percentage 
to the 

TwinCities. 

Soft coal. 

7,070,337 

1,364,568 

24 

48 

Hard coal. 

Total. 

8,434,905 

28 



Based on the figures given it may be stated that of all the coal 
received at Duluth-Superior about 28 per cent goes to St. Paul, 
Minneapolis, and the Minnesota Transfer; that of the soft coal 
about one-quarter goes to those places; and that of the hard coal 
about one-half reaches those points. 

70. Wheat —'The great wheat-growing section of the United States 
lies north of an east and west line through St. Paul. Three railroad 
systems are available for shipping this crop direct to Duluth- 
Superior without passing through the Twin Cities and only a very 
small part of that going to the head of the Lakes is hauled by the 
roads between Minneapolis and Duluth. The statistics submitted by 
the Stillwater citizens show that in 1908 there were hauled from the 
Twin Cities to the head of the Lakes 2,562 cars of wheat, or about 
2,135,000 bushels. The wheat shipped by lake from Duluth-Superior 
the same year was 53,057,105 bushels. The railroads between the 
Twin Cities and Duluth hauled into Duluth-Superior 4 per cent of 
the wheat carried down the Lakes from that harbor. 

71. The rate on wheat from the Twin Cities to the head of the 
Lakes is $1 per ton, or 3 cents per bushel. Wheat coming through 
from certain favored points goes to the head of the Lakes at a cheaper 
rates. The actual added amount for completion of the trip to 
Duluth is sometimes as low as 1 cent per bushel. A large shipper of 
























WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 21 


wheat in Minneapolis states, however, that 90 per cent of the wheat 
pays 3 cents per bushel, or $1 per ton. Wheat coming into Minne¬ 
apolis from the favored points may be stopped, offered for sale, and 
then sent on to Duluth without increase in rate. The wheat (90 
per cent of the whole), which must pay $1, comes into Minneapolis 
on cars on its way to Duluth. In order to transfer to barges, it must 
pay an elevator charge of three-fourths cent per bushel, or 25 
cents per ton; it would probably have to assume a different rate of 
insurance by water, leading to trouble and complications; and, 
although grain men claim that it takes as long as five days for rail 
shipments to reach Duluth from the Twin Cities, there is no doubt 
that they will average considerably shorter in time than those by 
canal. A case is related by a Duluth vessel agent where he, even 
in the congested season of 1912, learned on Saturday of an available 
vessel which would have her coal unloaded on Monday and could 
not get an ore cargo. A Minneapolis dealer had a cargo of wheat 
in Minneapolis which he wanted shipped. The wheat was delivered 
in Duluth and on its way down the Lakes by Tuesday noon. This 
could not have been done by canal. It may be argued that it could 
have moved earlier by canal. It would not have then been avail¬ 
able for sale in Minneapolis, as it was, up to the time the vessel 
was chartered. Again had it gone on to Duluth by canal it might 
have been held there many days in barges—not a cheap storage— 
without obtaining a vessel to carry it. 

72. The elevator charges (25 cents per ton) having been paid in 
Minneapolis, the wheat will be on the barges with 75 cents to pay 
a canal rate of 78 cents—on the Erie Canal basis, neglecting the 
Government’s investment. The wheat may be in an elevator in 
Minneapolis, and then it has to pay no more elevator charges than 
it would by rail, and the full $1 will be available for expense by 
canal. There are no figures to show what portion of the wheat 
going to Duluth-Superior now passes through the elevators (actually 
unloaded and loaded again) in Minneapolis on its way. It is not 
believed that it is large. It is seen above that 46 cents per ton 
should be charged against the freight to reimburse the public even 
if the canal hauls everything but coal, making $1.24 (78 cents + 
46 cents), the full cost by canal under those circumstances. So there 
is no hope that the canal will haul the wheat even in the most 
favorable case, except at a loss to the United States on its invest¬ 
ment. 

73. A Minneapolis wheat dealer states that the canal would be a 
oreat boon to the business. For what, since it can not compete with 
The rate by rail? To relieve the terrible congestion in Minneapolis? 
That would make the canal useful three months in some years and 
not at all in others. In support of his claim he submitted figures 
which showed the shipments by the roads—Northern Pacific, Great 
Northern, and Omaha—for the months of September, October, and 
November, 1912. An analysis of those figures showed some very 
startling traffic for the Omaha road. Upon investigation he learned 
that the figures from the books of that road included everything 
going out of Minneapolis—not to Duluth-Superior only. By allow¬ 
ing that the Omaha and Soo lines together carried as much as the 
average of the Great Northern and Northern Pacific, the shipments 
shown in the table below result. It is not believed that these two 


22 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


roads shipped together as much as the average of the other two, for 
the Great Northern and Northern Pacific hauled in the fiscal year 
1912, 92 per cent of the return heavy freight, as shown by the figures 
of the Railroad and Warehouse Commission. On the assumed basis, 
however, the figures are: 

Tons. 


Wheat, 2,784,030 bushels, or_ 83, 521 

Corn, 404,760 bushels, or_ 11, 333 

Oats, 382,560 bushels, or_ 5, 738 

Barley, 913,725 bushels, or_ 21, 879 

Rye, 31,440 bushels, or_ 880 

Flax, 140,055 bushels, or_ 3, 922 

Flour, 2,009,580 barrels, or_ 200, 958 

Mill stuffs_82, 521 

Linseed oil, 2,579,633 pounds, or_ 1, 290 

Oil cake, 31,733,504 pounds, or_ 15, 867 

Hay_ 1, 610 


Total 


429, 519 


74. It will be seen that these figures are larger than those given by 
the citizens of Stillwater in their statistics for 1908, being on wheat 
30 per cent more (for the three heavy months only) than the entire 
shipment for 1908. The wheat crop for 1912 was very large. It is 
understood that every elevator in Duluth-Superior and in Minne¬ 
apolis was full at the end of the lake navigation season; that thou¬ 
sands of loaded cars lay in Minneapolis; that all available ships on 
the Lakes were loaded with wheat; that the harbor at Buffalo was 
full of loaded ships; and that the insurance season on the Lakes was 
extended 15 days in order to relieve the grain congestion. Under 
these conditions it is not seen how the congestion could have been 
relieved by the canal, except to use the barges as storage, which 
would have amounted to little. Even with this heavy freight move¬ 
ment, and if it had all gone by the canal (i. e., represented the canal 
freight for the year), the tax alone to reimburse the United States 
for its investment, maintenance, and operation would have been, 


420,000 

429,519 


=98 cents, 


almost the cost of complete shipment by rail, as the average rail 
rate on all this list is practically $1. If less than the full amount 
given had been shipped by canal during the entire season the amount 
necessary to reimburse the public w T ould have been more than the 
rail rate. Without a return cargo and without coal there can be 
none; the canal rate must be greater than 78 cents. 

75. The canal can not compete with the railroad rate; it can not 
give better service; it can not relieve the congestion in large crop 
seasons; and it can not be brought into use in connection with the 
Minneapolis elevators, without a great deal of work on them in most 
cases and rebuilding in some cases. There appears to be no considera¬ 
tion whereby the canal can recommend itself as a transporter of 
wheat or coarse grain from Minneapolis to the head of the Lakes. 

76. Coarse grain .—In this are included rye, oats, barley, and corn. 
Most of such grain comes from a section farther south than the wheat- 
producing country, although some of them are raised in the same 
section. The statistics of the Stillwater citizens show that the rail¬ 
roads in 1908 shipped 4,500,000 bushels of these grains from Minne- 
















WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 23 

apolis and St. Paul to Duluth-Superior. The Duluth-Superior 
statistics show there were shipped down the Lakes the same year 
13,000,000 bushels. Duluth-Superior, therefore, got their local con¬ 
sumption and 8,500,000 bushels from other localities than through 
St. Paul and Minneapolis. The 4,500,000 bushels means about 
93,000 tons which moved to the head of the Lakes from St. Paul 
and Minneapolis. That portion of these grains raised in the general 
wheat section must almost necessarily find its outlet via the Great 
Lakes, as they would reach their natural market most cheaply that 
way. It is evident that 93,000 tons from Minneapolis and St. Paul 
found an outlet that way in 1908. But would any great amount be 
diverted to Duluth-Superior from the country south of St. Paul if 
the canal existed? The destination of these grains is St. Louis, 
Milwaukee, and the Middle and Southern States where large quanti¬ 
ties are used in distilleries and breweries or fed to stock in sections 
too far south to raise them economically. Their great market is 
Chicago. From St. Paul the Mississippi River runs southeast 143 
miles to La Crosse, then turns south. From that point to Chicago is 
270 miles by rail, and the rate on all grains is $2.50 per ton. Suppose 
grain comes to the Mississippi River by rail at La Crosse. It has the 
choice of taking the canal and reaching Chicago via Duluth-Superior 
or of continuing on to Chicago by rail at $2.50 per ton—probably 
reduced somewhat on through rate from point of origin to Chicago. 
Elevator charges at La Crosse (1 cent per bushel; average weight 
per bushel, 45 pounds) will be 44.4 cents per ton; freight from La 
Crosse to Duluth (at canal rate of 3 mills per ton-mile, 320 miles) 98 
cents per ton; elevator charges in Duluth, 44.4 cents; and 2J cents 
per bushel water transportation to Chicago, $1.11 per ton. This gives 
a total of $2.98 or an actual loss of 48 cents. 

The average value of a ton is about $210. It will require 9 to 10 
days to make the trip via Duluth without any delays, and there are 
many chances for delays. From La Crosse to Chicago by rail should 
be made in 3 days. The interest at 5 per cent on $210 for 6 days is 
17 cents and would be an additional loss to the 48 cents, or a total 
loss of 65 cents per ton. There is nothing in the canal to attract 
coarse grains from La Crosse, and La Crosse is considerably north 
of the Iowa-Minnesota line. Thus the canal can not draw coarse 
grain from Iowa, Missouri, and Nebraska; coarse grain is discussed 
under “ wheat ” in a way to show that the canal can not carry that 
from Minneapolis and St. Paul at a profit on the railroad rates; 
and it can therefore ship only the small amount that might reach 
the Mississippi River south of St. Paul and north of La Crosse—the 
southern limit of canal competition with rail to Chicago. This 
might mean 100,000 tons. In 1908 the Twin Cities sent 93,000 tons 
to the head of the Lakes and in September, October, and November, 
1912, they sent 88,000 tons. It will therefore be conceded that the 
canal might carry 100,000 tons of coarse grain from the country 
between St. Paul and La Crosse. 

77. General merchandise .—This class of merchandise is ill adapted 
to transportation by barges. Little or none of that received in the 
Twin Cities via Duluth-Superior originates in the latter cities. It 
practically all comes from the east under the lake-and-rail rate 
already mentioned, which costs the Twin City merchant only 40 
cents per ton over the cost to the Duluth merchant. As long as this 


24 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


arrangement exists there is no chance for this class of freight to be 
handled by the canal. This freight is handled on the lakes by rail¬ 
road-owned steamers; the railroads allow free storage and handling 
in Duluth and Superior; it is not adapted to barge transportation, 
and the railroads are not going to handle it from its origin to Duluth- 
Superior and then turn it over to independent barge owners for de¬ 
livery in St. Paul, not if they have to haul it at a loss. (See Appendix 
C, by Mr. Little.) 

78. No reason whatever can be seen for putting general merchan¬ 
dise in the list of probable freight for the canal. 

79. Iron and steel .—These goods come under the same lake-and-rail 
rate as applies to general merchandise, and the same statements 
and conclusions will apply. It therefore appears that this material 
has practically no chance of going by the canal. 

80. There is nothing left for the canal but an admitted 100,000 
tons of coarse grains to Duluth-Superior and a possible shipment 
of 250,000 tons of flour in the same direction. What appeared a 
4 to 1 one-way traffic from Duluth-Superior now becomes a com¬ 
plete one-way traffic to Duluth-Superior. With only 350,000 tons 
available, the cost to the United States will be: 


420,000 

350,000 


=$ 1 . 20 . 


81. Flour .—The rate on flour from Minneapolis to Duluth is $1 
per ton on all roads. But the railroads allow free storage and han¬ 
dling at Duluth-Superior for flour hauled by them from Minne¬ 
apolis. They haul it heavily during the slack or winter season and 
when the navigation season opens on the lakes there is a large stock 
on hand at the head of the lakes ready for shipment. The inde¬ 
pendent barge owner would have no storage, unless he built or 
rented it, except his barges. The vessels carrying flour on the Great 
Lakes are railroad owned; the railroads need flour as freight, par¬ 
ticularly in the winter; they are convenient to the mills at Minne¬ 
apolis and the docks at Duluth; and who can be so filled with 
optimism as to believe that flour would be transported by canal to 
Duluth and there received on equal terms by railroad-owned vessels 
even if the canal rate could compete with the railroad rate? One 
dollar per ton is the regular rail rate (although one road charges 
$1.50) and the canal rate has to he counted as 78 cents, leaving 22 
cents per ton for transferring to the steamer at Duluth. This allows 
nothing to reimburse the United States for its expenditure, which 
has been shown to require 13 cents per ton if the canal hauls every¬ 
thing between termini and along its route, and 46 cents per ton if it 
hauls everything but coal. On wheat, which is more easily handled 
than flour, the elevator charge in Duluth-Superior is 1 cent per 
bushel or 33 cents per ton, and the railroad-owned steamer in Duluth 
is not going to make it easy for the independent barge owner who 
has hauled the freight naturally belonging the railroads. Much flour 
now goes to the shores of Lake Michigan for shipment east, being 
hauled over roads in which, it is stated, the mills are interested. It 
is believed that it would require a great reduction in freight rate to 
make the flour mills desert the railroads, and the canal can not bring 
about this reduction. The flour mills can not be blamed for desiring 



WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 25 

to favor the railroads, as they would be absolutely dependent upon 
them five months in the year if the canal were built. 

82. Flour will not go by the canal. 

83. Local freight .—It is therefore manifest that there is nothing 
left for the canal but the local freight—18 per cent of the entire 
freight. It will be seen by looking back to case 3 that, with 18 
per cent of the total freight, the Government’s expenditure would 
amount to Tl cents per ton. Local freight would be largely general 
merchandise and we have seen that the lake-and-rail rate allows the 
St. Paul merchant to ship well back toward Duluth cheaper than 
the Duluth merchant can reach the same point. All the towns on 
the St. Croix River are below Taylor Falls, and the St. Paul mer¬ 
chant under present freight conditions can more than compete with 
the canal on general merchandise and steel—he can entirely defeat 
it. The production and consumption of the whole canal region north 
of the Grantsburg crossing of the Northern Pacific Railroad (and 
this is in the favored territory) are little or nothing to support a 
canal. 

84. Development .—The claim is made that the canal will develop 
a large commerce, and such articles as building stone, clay products, 
sand, cement, and lime are mentioned. This is all based on the 
absolutely mistaken idea that the freight rates through the canal 
are going to be 40, 50, or 00 cents per ton less than railroad rates, and 
that these very cheap rates will start a great trade in such things 
as must, in order to move at all, have very low rates. These false 
figures are based on what is read of the freight rates on such a 
waterway as the Great Lakes, where large volumes in one cargo are 
carried in the cheapest manner possible, and where rates are often 
much lower than they would be but for the fact that vessels can 
afford to move freight cheaply in order to get return cargoes, and 
thus be at least making expenses both ways. It is not appreciated 
by these advocates of canals that there is a vast difference between 
moving many thousand tons in one cargo over a wide, deep, direct 
and level waterway and taking the same commodities in small barges 
through a narrow, unduly long and shallow waterway over interven¬ 
ing hills to a height of more than 400 feet. There can be no cheap 
rate over such a waterway, and in the present instance there is 
not enough difference between the actual cost of transporting any 
commodity over the proposed canal and the present railroad rate 
to pay for the extra handling, breakage, inadequacy of service, loss 
of time, and probably increased insurance in the case of articles 
liable to damage from water. The whole argument is based on a 
fictitious low-rate to result from the canal, and they all assume that 
a low rate must follow its construction—they have heard it stated 
and do not question it. It can not follow, will not follow, and should 
not be expected to follow. 

85. Effect on railroad rates .—If the canal can not compete with 

the present railroad rates a reduction of railroad rates to meet 
canal rates is impossible. . ^ 

86. Diversion of traffic .—It has been claimed that the canal will 
attract a large commerce not now existing; that it will actually stop 
the shipment of coal from the Illinois fields to St. Paul and Minne¬ 
apolis by rail, all coal for these cities coming via Duluth-Superior 


26 WATERWAY EROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

from eastern fields; and that much grain from the country south 
of St. Paul, which now goes direct to Chicago, will go via Duluth- 
Superior through the canal. The Avhole foundation of these argu¬ 
ments is that same fictitious low rate through the canal. 

87. Steel plant .—Great stress is laid on the large steel plant now 
building in Duluth by the United States Steel Corporation. Its 
products may go east and compete in the eastern market. It has 
chosen to bring the coal to its iron ore, rather than take its iron ore 
to the coal. This is a wise move to balance shipments. The large 
bulk-freight carriers on the Great Lakes have iron ore and grain 
to take down the lakes and nothing but coal to bring back. The 
shipments of ore and grain from Duluth-Superior Harbor in 1911 
amounted to more than 20,000,000 tons. The coal brought back was 
about 8,400,000 tons; three vessels of every five came back empty. 
The establishment of a large steel plant at Duluth does away with 
the necessity of shipping its consumption of ore and calls for a cor¬ 
responding increase in the receipts of coal. It tends to balance 
trade and thus reduces the number of lake vesesls necessary to do the 
same amount of business. It should result in more economical pro¬ 
duction of the finished article and may enable the corporation to ship 
its steel down the lakes to the greater market, using an entirely dif¬ 
ferent class of vessel—the class that brings back general merchan¬ 
dise—from the bulk freighter. The Duluth steel plant may, and 
probably will, ship its product west into the undeveloped country 
toward the Rocky Mountains. But will it ship south? Not far. 
As soon as it reaches La Crosse it will be in the natural territory of 
its own plant at Gary and it is not establishing two plants to com¬ 
pete in the same territory. The Gary plant now has shallow-water 
connection with the Mississippi River at Rock Island and St. Louis, 
and in the probably not distant future will have a deeper canal. 

88. The large volume of the Duluth steel plant’s product will not 
go south; its raw material will come from the mines and the Lower 
Lakes; and it can have no great interest in this proposed shallow- 
water canal. 

89. General summation .—The Erie Canal rate would require a 
payment to the water carrier of 78 cents. The Government’s expend¬ 
iture on the canal would tax the freight to various extents, from 
13 cents to $4.25, corresponding to the proportion carried by the 
canal (from 100 per cent down to,3 per cent) of all freight between 
St. Paul-Minneapolis and Duluth-Superior and all the freight of 
eight counties which the canal will pass through or touch. If we 
neglect for the time being the Government’s expenditure the different 
commodities will appear as follows: 

(a) Soft coal: Canal rate=78 cents; unloading at St. Paul or 
Minneapolis=25 cents; breakage in unloading=25 cents; 50 per cent 
transferred to another yard, at least 10 cents; making same deliverv 
that railroad makes=25 cents; total=$1.63. Rail rate on soft 
coal=90 cents. Loss=73 cents per ton. 

(b) Hard coal: Canal rate=78 cents; unloading at St. Paul=25 
cents; delivery in St. Paul=25 cents; total=$1.28. It will be noted 
that the anthracite coal is charged nothing for breakage or extra 
handling to another large yard. Rail rate on hard coal=$1.25. 
Loss, 3 cents per ton. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 27 


(c) Iron and steel: Canal rate=78 cents; unloading in St. Paul 
(same as coal which is more easily handled) =25 cents; delivery 
(same as for coal) =25 cents; totai=$1.28. Storage in Duluth- 
Superior lost. Listed rail rate, $1.40 (actual much less). Gain, 12 
cents per ton. 

( d ) General merchandise: Exactly the same throughout as iron 
and steel, $1.28. (Storage in Duluth-Superior lost.) Listed rail 
rate, $1.16 (actual much less). Loss, 12 cents per ton. 

^( e ) Grain: Canal rate=78 cents; elevator charges in Twin Cities 
2< cents per ton (three-fourths cent per bushel, average weight of 
grain shipped Duluth-Superior 55.6 pounds per bushel, or 36 bushels 
to the ton) ; elevator charges in Duluth-Superior (1 cent per bushel), 
36 cents; total=$1.41 per ton. Railroad rate on grain=$l for 90 per 
cent and 50 cents for 10 per cent, or an average of 95 cents. Assume 
that one-half the wheat passing through Minneapolis would pay 
elevator charges even if sent forward by rail, 13.5 cents; elevator 
charges in Duluth-Superior 36 cents; total=$1.445. Gain, 3.5 cents 
per ton. 

(/) Flour: Canal rate=78 cents; loading in Minneapolis same as 
on cars; transferring in Duluth-Superior (same as wheat) =33 cents; 
total=$l.ll. (Loss of free storage and advantage of stocking up in 
Duluth-Superior during winter for spring opening.) Railroad 
rate=$l. Loss, 11 cents per ton. 

90. 13y adding the amount necessary to reimburse the United 
States—shown in each case under the heading—there will result: 

Table showing loss per ton. 


Article. 

Case 1, 
13 

cents. 

Case 2, 
25 

cents. 

Case 3, 
71 

cents. 

Case 4, 
$4.25. 

Case 5, 
46 

cents. 

Case 6, 
27 

cents. 

Case 7, 
34 

cents. 

Coal (soft. 

$0.86 

$0.98 

$1.44 

$4.98 




Coal(hard). 

.16 

.28 

.74 

4.28 


$0.30 

$0.37 

Iron and steel. 

.01 

.13 

.59 

4.13 

$0.34 

.15 

(Jeneral merchandise. 

.25 

.37 

.83 

4.37 

.58 

.39 


Grain. 

.095 

.215 

.675 

4.215 

.425 

.235 

.305 

Flour. 

.24 

.36 

.82 

4.36 

.57 

.38 

.45 


Then the actual losses, if we assume that everything will be carried 
in the same proportion, become: 

(t 

Actual loss. 


Article. 

Case 1. 

Case 2. 

Case 3. 

Case 4. 

Case 5. 

Case 6. 

Case 7. 

TONS. 

Trial (<!nft.) 1 794 000 

$1,482,640 

105,312 

24 

82,375 
31,303 
60,336 

$844,760 
92,148 
156 
60,958 
35,421 
45,252 

$446,861 
87,672 
255 
49,227 
40,034 
37,107 

$257,566 
84,513 
297 
43,197 
41,665 
32,883 




Coal (hard), 658,200. 

Iron and steel, 2,400. 

General merchandise, 329,500 

Grain, 329,500. 

Flour, 251,400. 

Total loss. 

Tons. 

Loss per ton (averago). 

$816 
191, no 

140,038 
143,298 

$197,460 
360 
128,505 
77,433 
95,532 

$243,534 

100,497 
113,130 

1,761,990 

1,118,695 

645,156 

460,121 

475,262 

499,290 

457,161 

3,295,000 

1,647,500 

593,100 | 

98,850 

912,800 

1,571,000 

1,239,100 

$0.53 

$0.68 

$1.09 

$4.65 

$0.52 

$0.32 

$0.37 






















































28 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

91. The most favorable of the assumed conditions (case 6) is the 
one wherein the railroad is allowed to move all the cheap freight (soft 
coal) and the canal is given all the higher class freight; but, even un¬ 
der these conditions, the loss would be 32 cents per ton. The only way 
to make up this loss would be for the water carrier to reduce his rate 
from 78 to 46 cents, and even then he would be only equaling the rail 
rate. If he improves 8 cents on the rate, he will be carrying freight, 
at 39 cents, or at just one-half the rate for an equal distance on the 
Erie Canal. Again, the conditions imposed—that he must in seven 
months of the year haul everything, except soft coal, for the whole 
year—are absolutely impossible. If his proportion should drop to 50 
per cent of all the high class freight he would have to carry it at 20 
cents per ton (one-quarter of the Erie Canal rate) in order to equal 
the railroad rate. 

92. There is no combination on which the canal can get the freight 
to an advantage to the public, without reducing the Erie Canal rate 
per ton-mile to about one-half. 

93. This means that, in addition to the Government’s annual loss of 
$420,000, the canal, if used, would impose a heavy tax on the commu¬ 
nity. Of course, the result would be that the Government would have 
to stand the loss of $420,000 per year, and the community would use 
the railroads. When once built, the slightest excuse—a few barge 
loads of hay per year moved from out-of-the-way places to the rail¬ 
roads, no further—would be enough to require the operation and 
maintenance of the canal. 

94. In this discussion it has been considered that all freight will 
make the complete distance and pay 3 mills per ton-mile the whole 
way. Shorter hauls may occur, but the shorter the haul the greater 
the advantage of the railroads, advantages for short hauls are always 
with them. Coal to Cincinnati (200 to 300 miles) goes by rail; to 
Memphis it goes mostly by river. 

95. Argument — It has been claimed that the assumed elevator 
charges are too high, and that, by foreseeing one’s needs and inviting 
offers from various elevators thus stimulating competition, cheaper 
rates may be obtained. This controversy was settled by three ques¬ 
tions and answers. (1) What is the standard charge for elevator ser¬ 
vice at the present time? Answer.—Three-fourths cent per bushel in 
Minneapolis, and 1 cent in Duluth-Superior. (2) Can there be any 
guarantee that, in case the canal be built and a large commerce es¬ 
tablished, even the standard present rates may not be increased? 
Answer.—No; but a raise would not be probable. (3) In your 
opinion, would the board be justified in allowing anything lower than 
the standard charge? Answer.—No. 

96. It has been claimed that the charge for delivery, landing and 
deterioration of soft coal are too high. To these claims it can be 
stated that the charge for delivery in carload lots in Duluth-Superior 
(and the coal people claim the actual cost is about equal to the charge) 
is 25 cents, and no reason can be seen why it will, or can, be done more 
cheaply in the Twin Cities. Cincinnati reports the cost of unloading 
from open barges to be 25 to 35 cents, and, with fuel so much cheaper 
there, no reason can be seen why it should cost as little as 25 cents 
here—especially if it has to be unloaded from decked barges. No re¬ 
turn freight can be handled in open barges. Regarding breakage, 25 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 29 


cents is generally given as a low figure by the people in Duluth-Su¬ 
perior who handle coal in large quantities. It will be seen that in the 
general summation no charge is made for breakage in hard coal. 
There is no doubt that, with a rail rate of $1, and a water rate of 50 
to 62J cents, Cincinnati is reducing its actual receipts by water. The 
difference by canal and rail figured herein is only 12 cents on soft, and 
47 cents on hard coal. 

97. Lake service .—The service on the Great Lakes is an express 
service. The vessels are large and expensive to run, the rates are 
low, and they must be kept moving in order to pay. As a result there 
have been established in Duluth-Superior the most complete system 
of handling bulk freight—iron ore, coal, and grain—that can be 
found anywhere in the world. Many of the steamers carrying gen¬ 
eral merchandise and flour are also passenger steamers running on 
schedules made out the previous winter. Everything is done with 
the greatest possible dispatch. Large lake freighters figure in hours 
if not in minutes the time they can get their cargoes and get away. 
They are not going to favor any method of handling freight which 
will delay them. They must have a full load and have it at once. 
Canal barges must be loaded and unloaded as quickly as the same 
material can be delivered on or received from the wharves. A vessel 
arrives with 11,000 tons of coal. She can unload at a coal dock in 
a few hours. It will require 20 barges of 550 tons’ capacity to carry 
her cargo. They must be on the spot and receive the coal as fast 
as it could be unloaded on the wharves. They must be decked barges 
if they are going to bring any possible return freight from Minne¬ 
apolis. The coal must be loaded in the barges through hatches and 
spread out to a depth of 5 feet, whereas on the wharf it is dumped in 
large piles. This is for a single cargo. Suppose 10 coal-laden ves¬ 
sels come in in one day; 200 barges must be on hand to take it all, 
and there must be 10 unloading devices ready to start work promptly. 
The 10 vessels can go to coal docks and be unloaded. A passenger 
vessel arrives at 10 a. m. She wants 2,500 tons of flour. She must 
sail at 10 p. m. That amount of flour must be on the wharf or on a 
lighter alongside as soon as she lands. By canal it may be coming 
down the slope from the Brule River. The vessel must look out for 
another cargo or she must go without that earning capacity, and the 
five canal barges, trailing down the slope, must delay in Duluth, 
unavailable for return service, until another vessel can receive their 
flour. The only alternative is adequate terminal facilities, with 
storage, for transfer from boat to barge, where probably the majority 
of the freight will have to be stored and loaded when craft are avail¬ 
able. This means an extra handling and the cost of the storage, 
neither of which has been considered in the above general summation. 

98. Steamboat canal .—The board is indebted to Capt. George 
Winans, a great enthusiast for the canal and a practical steamboat 
man on the Mississippi River, for the cost of running a towboat such 
as he states would tow four barges on the Mississippi River. His 
figures of daily expenses taken from his books are: 


1 master and pilot 

1 pilot- 

2 engineers- 

2 firemen_ 

1 cook and helper 


$ 8 . 00 
5.00 
5. 50 
4.00 
4. 25 







30 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


4 men_ 

2 watchmen 

Fuel_ 

Supplies_ 

Oils_ 


$ 8 . 00 
4. 00 
25. 00 
7. 25 
1.00 


Total___72.00 

99. His tow would consist of four barges 135 feet by 34 feet by 6 
feet, estimated to draw 1 foot empty and 5 feet loaded, the four 
barges carrying about 2,200 tons, 550 tons each. It will, for the sake 
of argument, be assumed that the canal is a steamboat canal and 
could carry such a tow. The distance from Minneapolis to Taylors 
Falls (open river navigation—half up river and half down river, 
either way) is 92 miles, and the tow could make 5 miles per hour, 
or cover the distance in 18.4 hours. In the canalized river, and 
particularly in the canal, where waits at passing points and for 
other boats to lock through would have to be made and where night 
navigation would be difficult, it is doubtful if an average speed of 3 
miles per hour could be made. The distance from Taylors Falls to 
Allouez Bay is 160 miles, and at 3 miles per hour would require 53.3 
hours. This tow would have to break up at every lock and lift, 
the four barges going through together and the steamboat following. 
Allowing 20 minutes for the operation of each lock and 35 minutes 
for each lift (small estimates for a steamboat canal), as allowed for 
a barge canal in House Document No. 69, Fifty-sixth Congress, first 
session, there would be required for 17 locks (including that between 

St. Paul and Minneapolis) and 8 lifts: (.- lX20-j-8 ^3 5 ) 2=20.6 hours. 

This gives 18.4—|—53.3—[-20.6=92.3 hours, or 184.6 hours for the round 
trip. 

When the tow reaches Allouez Bay it is quite a distance from the 
harbor of Duluth or Superior; there will be considerable time lost 
in distributing boats to different points and delivering them at others 
for the return cargo besides the time of unloading and loading; and 
it is not believed that the time so consumed can average less than 12 
hours at each terminus, and it will probably be more. The towboat 
will be busy all that time and can not take advantage of it for re¬ 
pairs and cleaning boilers. It is not unreasonable to allow 7.4 hours 
for such work out of every 9 days and the result is that it will take 9 
days on an average to make the round trip. It will be all that can 
be expected if one such fleet can make 23 round trips in a season, re¬ 
quiring 207 days out of a possible navigation season of 7 months, or 
214 days. Allowing the fleet to be in commission 214 days at $72 
would cost $15,408. Steel barges of the same dimension as those 
recommended by Captain Winans, except that they were 150 feet lono* 
instead of 135, recently built at Ambridge, Pa., for the St. Louis 
engineer office, cost $11,120 each, delivered in St. Louis. In the same 
proportion Capt. Winans’s barges should cost $10,000 each. He es¬ 
timates that he can put the deck houses and partially submerged cargo 
holds on them at $2,500 each. He claims that he can build a purely 
towing steamer of steel that will handle such a fleet in the Mississippi 
River for $20,000. This figure appears small and there is grave 
doubt whether it can be done. It will, however, be assumed that his 
four barges will cost $50,000 and his towboat $20,000. It is custo- 











WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 31 


mary to figure on steamboats 18 per cent to cover depreciation, main¬ 
tenance, insurance and interest (5 per cent) on the investment, and 
on barges 13 per cent for the same items. Now 18 per cent on $20,000 
amounts to $3,600 and 13 per cent on $50,000 amounts to $6,500. It 
will be assumed that the plant can be laid up in the fall, cared for five 
months and put in commission for $1,000. The expenses are then: 

Operating -$15, 408 

Overhead charges on towboats_ 3, 600 

Overhead charges on barges_,_ 6, 500 

Winter care_ 1, 000 


26, 508 

Possible freight=23X2,200X2=101,200 tons. 

Cost per ton=26.2 cents. 

100. This cost allows nothing for office expense, agents at terminals 
or other incidentals—practically supposes that the captain of the 
boat runs his own boat and does the business thereof without even a 
clerk on the boat or a representative at either end of the line. It also 
supposes that he can, without delay, obtain a full cargo for every 
barge at each end of the line. It has been shown that, of such freight 
as would go by water, four-fifths comes from Duluth-Superior and 
one-fifth goes to Duluth-Superior. On this basis, and considering the 
whole transportation problem, there would be three empty barges to 
one loaded one on the return trip to Duluth-Superior, and the total 
freight carried would be five-eights of 101,200 or 63,250 tons at a 
cost of 41.0 cents per ton. This is 1.61 mills per ton-mile against 3 
mills on the Erie Canal. This was to be expected since the cheapest 
method of handling freight on shallow water is in fleets of barges 
towed by steamer. It comes nearer representing a large cargo vessel. 
Therefore, under present conditions of one-way traffic, the very 
cheapest method of handling cargoes in a steamboat canal would be 
42 cents per ton, and this allows the owner and master of the fleet 
only 5 per cent on his investment and not even salary for himself for 
5 months unless he becomes shipkeeper and earns a part of the $1,000 
allowed for winter expense. If not, he gets $8 per day for 214 days, 
or $1,712 for his year’s services. 

101. It is doubtful if many Mississippi River steamers are run as 
economically as Capt. Winans’s figures would indicate. His crew 
of 4 deckhands (2 to a watch) and 2 firemen (1 to a watch) looks 
small to handle such a fleet without even a mate to boss them. Again, 
it is very doubtful if any river plant would be built if the figures on 
paper could show nothing more than a return of: Wear and tear, 
insurance, operating expenses of the fleet only (no office or terminal 
expenses), and 5 per cent on actual cash invested. A large manu¬ 
facturer in St. Paul recently stated that money could not be had for 
such an enterprise unless an income of 15 per cent could be shown 
on paper. 

102. Capt. Winans's business is towing logs and lumber where he 
picks up the raft when notified that it is ready and drops it on 
delivery. It is inconceivable that a regular business in moving 
freight between two harbors, where shipping may occur at one end 
from any point along several miles of river front or from either of 
two towns 13 miles apart and at the other end from almost any 
point of 50 miles of water front, can be carried on without an 







32 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


office and agent in St. Paul-Minneapolis and another in Duluth- 
Superior, if not one in each of the four cities. In Duluth-Superior, 
where four-fifths of the freight will be received, lake vessels will 
not be waiting for a steamboat man to come and unload them. There 
is plenty of room for them to unload their coal and general mer¬ 
chandise, and waiting will not be tolerated. A canal business of 
any importance would require outlay at each terminal in the shape 
of offices and agents to arrange as to where the canal cargo was to 
be discharged and the return cargo to be had. The lake vessel owner 
or captain will not be looking along the water front for some fleet of 
canal boats with 2,000 tons of freight to load his lake vessel, which 
will carry 12,000 tons. Terminal expenses would be considerable, 
and Capt. Winans’s estimate of cost does not even allow for a long¬ 
distance telephone message. Assume that the freight can be moved 
at Capt. Winans’s figures. We have seen that if all the freight 
available were moved by a barge canal at 78 cents the loss would 
be 53 cents per ton. To avoid this loss the canal freight must be 
reduced to 25 cents to make canal equal to railroad. Capt. Winans 
can move it at 42 cents. Conclusion: If the much more expensive 
steamboat canal were built and Capt. Winans’s meagerly equipped 
outfit could handle all the present freight in seven months, there 
would be a loss to the public of 17 cents per ton. 

103. It will be seen that in case 5 his rate approaches the rail rate. 
Allowing the barge-canal rate of 78 cents there figures a loss of 
52 cents. To avoid this loss only 26 cents can be paid for freight. 
The freight, assuming no coal to be carried, is evenly enough bal¬ 
anced to make it cost the captain 33 cents, and he is only 7 cents 
behind the railroad rate. In case 6 the barge-canal loss was 32 cents 
on a 78-cent freight rate. Therefore, a freight rate of 46 cents could 
have been paid without any loss. The movement is so balanced that 
the captain could have handled the freight at 33 cents, showing a 
saving of 13 cents on 1,571,000 tons, or $204,250. With a movement 
of 1,571,000 tons, the reimbursement to the United States was 27 
cents. Had the movement been decreased so as to cost the United 
States 40 cents there would have been no saving. 

420 000 

-—=1,050,000 tons=67 per cent. 

104. In order to equal the railroad there must be carried 67 per 
cent of everything but soft coal. 

105. Similarly in case 7 the loss on a 78-cent rate was 37 cents. 
There could have been paid 41 cents without loss. The freight move¬ 
ment is so balanced as to have cost Capt. Winans 28 cents, showing 
a saving by his method of 13 cents per ton on 1,230,100 tons, or 
$161,083. In case 7 the cost to the United States was 34 cents per 
ton. Should the amount of freight handled be such as to raise this 
cost to 47 cents, the captain’s saving of 13 cents would disappear. 

42( V? 00 =893,617 tons=72 per cent. 

106. Advantage must be had of selecting an evenly balanced, high- 
class freight (grain and flour north, and hard coal south) and 72 per 
cent of it must be carried by the captain’s cheap method in order 
for him to equal the present railroad conditions. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 33 


107. All of this discussion is based on the cost to the United States 
of the barge canal. In House Document No. 330, Fifty-fourth Con¬ 
gress, first session, it was estimated that a steamboat canal via the 
St. Louis River would cost 70 per cent more than a barge canal. 
If the increased cost of maintenance, operation, and interest on 
investment for a steamboat canal via the Brule-St. Croix over that 
for a barge canal were 49 per cent, it would entirely wipe out the 
largest saving shown for the steamboat method of towing. On the 
basis of 70 per cent increase in cost of construction the interest 
alone would increase the Government’s annual expense by 46 per 
cent, leaving only 3 per cent, or $12,600, for increased cost of main¬ 
tenance and operation of a steamboat canal over that of a barge 
canal. 

108. It must therefore be concluded that: 

(a) Even with the steamboat method of towing, the conditions 
necessary to show a saving (having the pick of the freight and 
necessarily moving 67 or 72 per cent of it in the open season) are 
so rigorous that they could not be expected to exist—and this with no 
additional cost to the United States for construction, operation, and 
maintenance over those of a barge canal. 

(b) With the additional cost to the United States of the steam¬ 
boat canal, there are no possible conditions which would show the 
steamboat method of towing to be as economical to the public as the 
railroads. 

( c) The water supply at the summit level has been reported doubt¬ 
ful for a steamboat canal, and more recent investigations make it 
more than doubtful. 

(d) There is nothing to recommend a steamboat canal rather than 
a barge canal. 

109. Water power. —Great hopes have been based on the water 
power to be developed along the route. Estimates have been placed, 
on the value of the large horsepower to be developed, running into 
very high figures. The paper submitted by the Stillwater Citizen’s 
Canal Association (Appendix E) states: 

Assuming that this amount of power (50,000 horsepower) could be utilized 
in the operation of the canal and for commercial purposes and sold at the very 
low average of $20 per horsepower, it would represent an annual income of 
$ 1 , 000 , 000 . 

110. A recent investigation of the power possibilities of the St. 
Croix River shows that it is possible to develop 12,650 continuous 
horsepower in the first 140 feet of elevation above Taylors Falls. 
There remains to the summit level an elevation of 123 feet and a 
watershed of 2,084 square miles. The Markham-Kelsey project, near 
the Northern Pacific bridge (to Grantsburg), with a head of 60 feet 
and a watershed area of 5,675 square miles gives a horsepower of 
8,000 (continuous). If, in the same proportion, all the water above 
the 140 feet above Taylors Falls Dam could be concentrated in one 
dam it would give 6,000 continuous horsepower. This is a limit no 
one will claim could be attained. It must not be forgotten that, to a 
considerable extent, navigation and power development are antago¬ 
nistic. At the time that the summit level waters must be con¬ 
served and held for navigation, the power developments need them 

H. Doc. 1008, 64-1 - 3 


34 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


most. Water used to lock boats up or down the river is water abso¬ 
lutely wasted for power purposes. If the summit level furnishes 
just enough for navigation in the dry season, it will not furnish one 
cubic foot for power purposes. There are only 94 feet fall in the 
total canalized portion of the Brule and its summer flow is not more 
than 200 second feet, giving about 1,700 continuous horsepower. The 
small streams crossed by the canal on the Lake Superior slopcrwould 
give very little horsepower—probably scarcely worth developing, be¬ 
ing in such small units. The total watershed of these streams above 
the canal line is not seven townships, or 252 square miles. If each 
stream could locate a 60-foot dam on the lake side of the canal, the 
total development (based on the St. Croix Valley rainfall and run¬ 
off) would amount to 720 horsepower. Thus we have a possible de¬ 
velopment of 21,000 horsepower (allowing 100 per cent efficiency) 
instead of 50,000. The figure of $80 (or even $20) per horsepower 
year appears attractive, but sight seems to be lost of the fact that 
there will not be a power house, a turbine, a generator, or a trans¬ 
mission line included in the Government work of developing navi¬ 
gation. An idea of what the Government may expect to get from 
these developments may be had from the project between St. Paul 
and Minneapolis. The plan, which passed one House of Congress, 
was to pay the United States 4 per cent on $700,000 (the additional 
cost of the dam, made necessary to produce the power), giving 
$28,000 per annum to the United States for 15,000 horsepower, on the 
basis of dam and power house foundation furnished by the United 
States. On the St. Croix and Brule Rivers there is no estimate for 
even the power-house foundation, which is more expensive than the 
same length of dam. This allows the United States $1.87 per horse¬ 
power year. It is understood that the measure failed of passage be¬ 
cause it was thought that 4 per cent should be paid on $950,000 (the 
total cost of the dam, the increased height of lock, and the power¬ 
house foundation), giving a value to the United States of $2.53 per 
horsepower year. The 21,000 possible horsepower on the St. Croix 
and Brule may therefore figure as worth to the Government an 
annual rental of from $39,270 to $53,130 Avhen power-house founda¬ 
tions have been provided. This is small compared with the $420,000 
annual expense of the canal to the United States, and very small 
compared with the Stillwater estimate of $1,000,000. 

111. Terminal facilities .—Adequate terminal facilities exist in 
Duluth-Superior for transfer from lake to rail equalled in few 
ports in the world for handling bulk freight. There are no termi¬ 
nal facilities available for transfer from lake vessels to canal barges. 
These must be provided either in the shape of floating elevators and 
derricks for handling freight alongside the lake carriers at dock or 
at anchor in the harbor, or they may be provided by systems of 
docks where the lake carrier lies on one side and the canal barge 
at the other side, the freight being transferred across. At St. Paul 
and Minneapolis there are no terminal facilities except the usual 
Mississippi River levee at the St. Paul steamboat landing. Practi¬ 
cally no terminal facilities suitable for canal purposes exist at either 
locality, but it is presumed they will build up if a large commerce 
demands them. If the board’s recommendation be adopted, they will 
not be needed. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 35 

112. Ultimate fate of such a canal. —The commissioner of corpora¬ 
tions reported in 1909: 

About 4,500 miles of canals have been constructed. More than one-half— 
2,444 miles, costing $80,000,000—has been abandoned. 

113. It is the firm belief of the board that the construction of 
the proposed canal would result in an ultimate addition to every one 
of the figures in the above quotation. 

114. Conclusion. —The board therefore finds that the proposed 
canal connecting Lake Superior and the Mississippi River by way 
of the St. Croix River is not now feasible and practicable, consid¬ 
ering the necessary location, plans, costs of construction, commerce 
affected, and water supply. 

Chas. L. Potter, 

Lieutenant Colonel , Corps of Engineers. 

Francis R. Shunk, 

Lieutenant Colonel , Corps of Engineers. 

E. D. Peek, 

Captain , Corps of Engineers. 

[For report of the Board of Engineers for Rivers and Harbors, see 

p. 3.] 


APPENDIX A. 


REPORT OF G. A. TAYLOR, JUNIOR ENGINEER. • 

United States Engineer Office, 

Duluth, Minn., January 4 , 1918. 

From: G. A. Taylor, junior engineer. 

To: Capt. E. D. Peek, Corps of Engineers, Duluth, Minn. 

Subject: Lake Superior-Mississippi River canal survey. 

I submit herewith the following report describing the route traveled by 
myself and party and the results of the exploration. The examination included 
the Amnicon and Moose Rivers, the divide between the headwaters of these 
rivers and the adjacent country; also the country from the Amnicon River to 
Allouez Bay, with a view to determining the feasibility of constructing a barge 
canal by this route from Duluth-Superior Harbor to the St. Croix River, and 
thence via the St. Croix River to the Mississippi River. I have also considered 
the comparative merits of this route and the Brule River route, a report on 
which may be found in House Document No. 33, Fifty-fourth Congress, first 
session. 

The Amnicon and Moose Rivers were gauged in various places, as well as 
their tributaries, as is shown in a tabulated form herewith; the character of 
the river bed and soil of adjacent land and location of some dam sites were 
noted. 

In looking up data before leaving the office it was learned that the Wisconsin 
Central Railroad Co. (now controlled by the Soo Railroad) in locating their 
line to Duluth and Superior in 1904-1905, ran a preliminary line up the Moose 
River across the divide between that river and the Amnicon and a short dis¬ 
tance down the latter. By request the notes of this survey were obtained, in¬ 
cluding topography and level notes, and these have been a great help and have 
given far more accurate and reliable information, especially as to summit 
elevations, than would have been possible to obtain in the limited time and at 
the expense contemplated in this exploratoin. 

The results of my examinations and explorations will follow and are illus¬ 
trated by profile and map accompanying. 

(In referring to location by sections the figures only will be used. Thus 
8-48-12 will be used as an abbrevaition for section 8, township 48 north, range 
12 west.) 

Route traversed .—In compliance with your instructions dated October 14, 
1912, I assembled a party consisting of Mr. Charles Carisch, United States 
junior engineer, as sketcher and topographer, two cruisers, and a cook, and with 
them left Duluth October 15, via the Northern Pacific Railway for Amnicon 
Falls, Douglas County, Wis. The Amnicon River was explored down to the 
crossing of the Brule-St. Croix survey sketching the controlling features of 
topography. 

I looked over the country between 18-48-12 and 3-48-13 for a suitable 
route to Allouez Bay. 

Possible dam sites were noted and elevations taken by aneroid barometers to 
give the profile of the river, after which I proceeded to explore the Amnicon 
River south to its source. 

The tributaries of the Amnicon River being small and the discharge of the 
river itself being entirely inadequate for canal purposes, a search was made for 
feed water for the summit level. To this end I looked over streams to the west 
in 46-13 and 14, and 47-14. 

The Black River was gauged and barometer elevations taken in several places, 
and the country lying between this river and the headwaters of the Amnicon 
explored to determine the practicability of using Black River as a feeder for the 
summit level. The country east of the summit was also explored to determine 
the possibility of bringing feed water from the east, and also the possibility of 

37 



38 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


going around the highest portion of the divide between the Amnicon and 
Moose Rivers. 

It was found practicable to use a team for moving the camp outfit by clearing 
out the old St. Croix Road and as it would have been necessary to cut a trail 
to pack over, the team proved the more economical, and in this way we were 
able to make long moves with less lost time than would otherwise have been 
possible. 

The Wisconsin Central Railway preliminary line “ D ” was followed in ex¬ 
ploring the summit level. After leaving the Amnicon River this line practically 
followed the east one-sixteeenth line through the sections lying directly south 
to the crossing of the Moose River. 

The Moose River, its tributaries and the contiguous country were explored 
to its confluence with the St. Croix River. The Moose River was gauged at 
several suitable places and the St. Croix River at a point 50 feet below the 
mouth of the Moose River. 

Barometer elevations were taken on bench marks of the Brule-St. Croix 
canal survey of 1S94 at the big dam on St. Croix River, and a cursory exami¬ 
nation made of the St. Croix River from the mouth of the Moose River up to 
Upper St. Croix Lake while moving party and camp outfit to the railroad at 
Gordon, Wis. 

This ending my mission relative to the Amnicon-Moose River route, the party 
returned to Duluth on November 6, 1912. 

Previous to starting on this trip, I took a barometer to Hawthorne, Wis., 
where a railroad bench mark referred to sea level is located, and where this 
barometer was read hourly by Mr. M. J. Hoard during the time field work was 
in progress. 

The location and course of the Amnicon and Moose Rivers with some of 
the dominating topographical features and some elevations in the adjoining 
territory may be seen on the map. The elevations referred to sea level of the 
different points on the course of these two streams, as well as over the divide 
between their headwaters, is shown on the profile. The map and profile accom¬ 
pany this report. 

Description of Amnicon River from its source northward .—The Amnicon 
River has its source in Amnicon Lake in 46-14, which lake is fed by small 
streams from a comparatively small drainage area to the northeast of the lake. 
The river leaves the lake with very little current and flows through a flat, 
swampy country for about 1 mile, where it joins the Bear River, which has 
its source in swamps about the center of 45—14. Bear River is a sluggish 
stream flowing through a flat, marshy country. After its junction with Bear 
River, the Amnicon flows in an easterly direction to Lyman Lake through a 
country somewhat rugged, hut with only slight fall. Lyman Lake is shallow, 
having an area of about three-quarters of a square mile. The land to the south 
and west is low and swampy. There is a logging dam at the outlet of Lyman 
Lake with a possible 11-foot head, which in former years has been used in 
logging operations, but is now out of repair. When closed this dam flooded the 
swamp to the south and west. The ground to the north of Lyman Lake is 
some higher than in the immediate vicinity, but is not of sufficient height to 
maintain more than a 15-foot head of water. 

Amnicon River leaves Lyman Lake in an easterly direction for about 1 
mile, when it turns to the north and continues in this general direction for 74 
miles. This portion of the river traverses a broken country of red clay and 
bowlders. Ledge trap rock is often encountered, and the bed of the river is 
mostly bowlders and gravel. The river falls rapidly to the north with no 
marked falls, but almost continuous rapids, there being a total fall of 199 
feet in this stretch of river. The course of the river is sinuous, with bottoms 
one to seven hundred feet wide, and the general elevation of adjacent land from 
20 to 50 feet above the river. 

Then the river flows to the east and northeast, after which it flows in a 
northerly direction to 8-48-12, which is as far as my mission took me along 
the river. 

From the center of 11-47-13 through 12-47-13 and 7-47-12 the river is slower, 
running through a bottom land south of a range of rock ridges. These ridges 
lie 600 to 800 feet north of the river and have an elevation of 140 feet above the 
river. The bottom lands through which the river flows are from 400 to 700 
feet wide, of sand, with land 20 feet higher to the south. Through these bottoms 
the course of the river is very tortuous and changes during high water, there 
being numerous old river beds which at the present time are dry. 


WATER WAV FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 39 


After the course of the river turns to the northeast in 7-47-12 its fall is 
more rapid, the bed of the stream becoming more rugged with ledge trap rock 
and bowlders predominating. This condition prevails as far as the center of 
32-48-12, where the fall of the river becomes greater, and small falls of from 
1 to 3 feet over bowlder or ledge rock become common. It continues so as 
far as 29-48-12, where there is a series of five falls, called Anmicon Falls, 
ranging from 4 to 26 feet in height. There is a total fall of 120 feet in about 
1 mile in 32 and 29-48-12. At the last falls situated near the east and west- 
one-quarter line of 29-48-12 the formation of rock changes abruptly from 
trap to sandstone, and from this point north is of sandstone formation. The 
river continues rapid with a bed of bowlders and gravel with short stretches 
of sandy bottom. From 32-48-12 north the course of the river is through a 
very rugged country with deep ravines with ridges rising 80 to 100 feet above 
the river. 

As will be noticed by reference to the profile the Anmicon River in the 
southeast quarter of 18-48-12 is 100 feet below the general level of the sur¬ 
rounding country, which would necessitate a dam of this height. The bottoms 
are 800 feet wide. This condition holds true throughout the lower reaches of 
the river. Deep, wide ravines leading off from the river bottoms preclude the 
possibility of supporting a canal along this river bank, thus avoiding so large a 
dam. 

There are at present no dams on the Amnicon River below the outlet to 
Lyman Lake. 

The table of gaugings for the discharge of this river is given on another 
page. At the time these gaugings were taken the river was at a low stage, 
but not at its lowest stage. From settlers and other evidence, it seems probable 
that at times the Row of the river is not over one-half of the present discharge. 
Such a stage of low water probably occurred during the season of 1894 when, 
according to evidence obtained, Lyman Lake was about one-lialf foot lower than 
at present. 

Line pom Amnicon River to Allouez Bay. —The extension from Anmicon 
River in 18-48-12 to Allouez Bay presents no obstacles greater than those that 
would be encountered in the Brule-St. Croix westerly extension. The soil is 
red clay with a few bowlders, and the country is uniform, sloping gently to 
the north, crossing some ravines, which are not deep, and could be made use 
of for impounding water for canal purposes. 

The Moose River from its source southward. —This river has its source in 
Moose Lake in the southeast corner of 36-46-13. This is a shallow lake of 
about 12 acres surrounded by swamp land. It has a drainage area of about 
3 square miles, and the discharge from the lake is small. 

The river leaves the lake in a southerly direction and in 12-45-13 is joined 
by a branch from the northeast, after which it continues in a southerly direc¬ 
tion to its confluence with the St. Croix River. There are four logging dams 
on the Moose River. These are small earth dams of from 9 to 12 foot head, 
with timber sluiceways and gates, used in past years in logging operations, 
and at present are more or less out of repair and the gates in all of them are 
open. These dams with the gates open hold more or less of a head of water. 
That located in 35-45-13 holds a head of 8 feet and the water backs up li miles 
above the dam. The other dams hold a head of from 2 to 4 feet with the 
gates open. 

The Moose River does not fall as rapidly as the Amnicon, but is a rapid 
stream. It its upper reaches it is not as swift as in the lower half of its course. 
The soil in the vicinity of the stream is sandy loam, becoming very sandy in 
the lower four miles of its course. 

The bed of the river is gravel and bowlders, as a rule, with occasional short 
stretches of sand bottom. There are no falls on the stream, but rapids 
abound throughout its length. Ledge trap rock is frequently encountered, it 
being very common south of the town line between 44 and 45. 

The course of the river is winding, but not to the same degree as in the 
case of the Amnicon. The river bottom is comparatively narrow, varying 
from one hundred and fifty to six or seven hundred feet in width, with 
adjacent land generally from 25 to 50 feet above the river. The character of 
the river course and its fall are best explained by the map and profile 
previously mentioned. 

The divide between Amnicon and Moose Rivers. —The country in 23, 26 and 
35_46-13, which sections lie due south of the Amnicon River and on the 
shortest course to the Moose River, is all swamp with an occasional low 


40 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


island of more firm bottom. In 23 and 2G the soil is bog and soft mnek. 
Soundings taken in these sections by the Wisconsin Central Railway 
in 1904-1905 show soft bottom to a depth of from 12 to 24 feet 
underlaid with sand. The elevation of this swamp is 1194 feet above sea level. 
The ground rises to the south until at the south line of 2-45-13 it has an 
elevation of 1,206 feet above sea level. The actual divide or water shed on a 
direct line between the Amnicon and Moose rivers is a ridge of hills in the 
• south half of 11-45-13 with an elevation of 1,232 feet above sea level. The 
soil is sandy loam and gravel with a few scattering bowlders. Most of the 
country is cut over and much of it burned over and grown up with small 
second growth. In 2-45-13 is a spruce swamp of considerable extent where 
the original spruce timber is standing. 

The large swamp south and southeast of Lyman Lake is bordered on the 
east in section 24 and the northerly portion of 25-46-13 by a range of hills 
rising about 30 feet above the elevation of the swamp, which precludes the 
possibility of bringing feed water in from this direction, as this range forms 
the watershed from the west for the head waters of Middle River. 

There is comparatively low ground from this swamp diagonally through 25 
and 36-46-13 from northwest to southeast, to Moose Lake at the southeast 
corner of section 36. 

A canal built from the swamp, above mentioned, by this route and thence 
down the Moose River would go around the ridge of hills in 11-45-13, and 
would probably have to cross a maximum elevation of about 1,210 feet above 
sea level. As this route would add nothing to the water supply but increase 
ihe length of canal 2 miles or more, and make it more indirect, it is thought 
that the direct route with a cut through the higher ground is the more 
advantageous. 

A careful examination of the country at the summit developed what is shown 
quite conclusively on the map accompanying, viz: the land lying between the 
headwaters of the Amnicon and Moose Rivers is the apex of the country in 
this vicinity, from which streams flow in all directions. 

By examination Black River in 34-47-14 was found to have an elevation of 
102 feet below Amnicon Lake, and in 8-46-14, 72 feet below the same lake. The 
land adjacent to the river on either side is from 40 to 50 feet above the river, 
but not of such a height as to make it possible to dam the river and carry the 
water over to Amnicon Lake. The discharge of the Black River at this time is 
but 9 second-feet in 8-46-14, and settlers at this point report that it was prac¬ 
tically dry in summer of 1910. 

As previously stated, no feed water can be supplied from the east, because of a 
range of hills in that direction from which the land falls to the east. 

My examination of the country brings me to the conclusion that the only supply 
of water available for the summit level of a canal is that which can be derived 
from the Amnicon River watershed above and including Lyman Lake. This 
watershed has an area of approximately 65 square miles, or 1,812,096,000 square 
feet. 

The mean precipitation at Duluth for the last 42 years is 30 inches per 
annum. Assuming that the precipitation at the headwaters of the Amnicon 
River is the same as at Duluth, and that 0.8 foot can be saved for storage, we 
have 1,449,676,800 cubic feet available. Assuming that the canal would be in 
operation six months during the year, there is 93 second-feet available for canal 
purposes, provided it can be properly conserved. 

At present the discharge from the Amnicon River where it leaves Lyman Lake 
is 6 second-feet. 

Both the Amnicon and Moose Rivers are flashy streams. Their tributaries 
are small, comparatively short, and fall rapidly. The flood stage is of short 
duration, lasting from three to seven days. 

Conclusions .—The distance from Allouez Bay to St. Croix River via the Amni¬ 
con and Moose Rivers, following the general course of the rivers, but not in¬ 
cluding their windings, is 35 miles. 

The total elevaton to overcome from Allouez Bay to the crest of the divide is 
630 feet. 

The total fall from the crest of the divide to the St. Croix River at the mouth 
of the Moose River is 245 feet. 

Because of the ruggedness of the country adjacent to the Amnicon River, its 
very tortuous course, and the presence of ledge rock at intervals throughout its 
length, this river would be very expensive to canalize. 

The divide between the Amnicon and Moose Rivers offers no insurmountable 
difficulties. The surface soil being muck ou a substratum of sand, the filtration 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 41 


may be expected to be large. Some rather heavy earth work may be necessary 
through the crest of the divide. 

The Moose River can be canalized with no great difficulty so far as topography 
of the country is concerned. Some ledge rock would be encountered. 

The water supply by the Anmicon-Moose River route is inadequate for canal 
purposes. I am directed by my instructions to find an “available water supply 
by local streams or by feeders, so as to obtain five or six hundred or more sec¬ 
ond-feet for the operation of the canal.” This I find it impossible to do, for rea¬ 
sons previously stated. 

In this connection it may be stated that my examination was made at a favor¬ 
able season of the year. There had been a deficiency in rainfall in this locality 
for some time. The swamps were comparatively dry and the streams were at a 
low stage. While the discharge, as shown by the gaugings, may not be the mini¬ 
mum for the streams, it probably approximates it, as it is not likely that they 
have a smaller discharge for any considerable length of time. 

The country crossed by the proposed extension from Amnicon River in 
18-48-12 to Allouez Bay and the land adjacent to the Amnicon River from 
the crossing of the Northern Pacific Railway to 12-47-13 is fairly well settled 
and the land more or less cleared and improved. From here south there are a 
few scattered* settlers as far as 2-40-13. To the south of this point across 
the divide and down the Moose River to 12-44-13 the land is unimproved. The 
timber has been cut and much of the country burned over. There is one settler, 
with some cleared land, in 12-44-13. There are improved farms in 14-4 4 -13, 
and from here to the mouth of Moose River there are settlers and the land is 
more or less improved. The cost of right of way would be small, as a large por¬ 
tion of the land needed is of little value in its present state. 

Comparison of Amnicon-Moose River route with Brule-St. Croix River route. 

Length Allouez Bay to mouth of St. Croix River: 

Via Brule-St. Croix Rivers_miles_210 

Via Amnicon-Moose Rivers and St. Croix_do_184. 5 


Difference in favor of the Amnicon-Moose route_do_ 25. 5 


Drainage area tributary to summit: 

Via Brule-St. Croix Rivers_square miles_ 731 

Via * Amnicon-Moose Rivers_do_ 65 


Difference in favor of Brule-St. Croix route_do_ 6G6 


Probable water supply from area tributary to summit for 6 months: 

Via Brule-St. Croix River route_second-feet_ 917 

Via Amnicon-Moose River route_do_ 93 


Difference in favor of Brule-St. Croix River route_do_ 824 


The water supply, as determined by gaugings of streams at a low stage: 

Via Brule-St. Croix River route_second-feet— 625 

Via Amnicon-Moose River route-do- 6 


Difference in favor of the Brule-St. Croix River route_do_ 619 

Lift to be overcome on the different routes: 



Allouez 
Bay to 
crest of 
divide. 

Crest of 
divide to 
Missis¬ 
sippi River. 

Total. 

1 Brule-St Croix Rivfvr route....................i.. 

Feet. 

420 

630 

210 

Feet. 

355 

565 

210 

Feet. 

775 

1,195 

420 

2 A mnir»nn-\fonsA River route . 

3 Difference in fav n r of Brule-St Croix route.. 



Note.— The figures in this report relative to the Brule-St. Croix River canal route are taken from the 
report on this subject printed in House Document No. 330, Fifty-fourth Congress, first session, and so 
far as this route is concerned apply to the date of surveys and examinations made at that time. 
































42 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


The Brule-St. Croix River route has not been looked over in full by the writer. 
Knowledge of this route has been obtained by going over the portion of the 
route from the mouth of the Moose River to the upper Lake St. Croix, conversa¬ 
tion with Mr. Charles Carisch, United States junior engineer, who was an 
instrument man on the survey of this route, and by a careful perusal of the 
reports previously referred to. 

From the evidence obtained from all these sources of information and a 
personal knowledge of the Amnicon-Moose River route I am of the opinion that, 
despite the fact that the Brule-St. Croix River route is 25£ miles longer, it is 
the better route. 

The supply of water by the Amnicon-Moose River route is so entirely inade¬ 
quate as to make the operation of a canal by this route, save by pumping 
water, impossible. 

The supply of water being fundamental in considering the possibility of a 
canal, and the possible supply in this case being so obviously inadequate, I 
have not taken the time to go into a study of the best elevation for a summit 
level and other related subjects that would be considered if a canal by this 
route were deemed feasible. 

The distance from Allouez Bay to Anmicon River is about miles; from 
there to where the route leaves Anmicon River, 144 miles; across the divide, 6 
miles; Moose River to its mouth, 9 miles. The total distance from Allouez Bay 
to the confluence of the Moose and St. Croix Rivers is about 35 miles. 

The elevations along the Anmicon River were taken by barometer, and 
corrected by comparing with readings of a fixed barometer located at Haw¬ 
thorne, Wis., read hourly, and referred to a railroad bench mark of known 
elevation. This is aW- true of elevations on Moose River below 11-11-13. The 
elevations over the divide from 14-46-13 south and down the Moose River 
to 11-44-13 are most of them based on spirit levels from the Soo Railway 
survey of 1904-5, which have been reduced to sea level. The profile accom¬ 
panying is compiled from the data thus obtained. 

The rivers were located by tying to section lines by means of pacing and 
was very well done by cruisers, as was demonstrated on numerous occasions 
when I had means of checking their work. 

List of existing dams which have been used in logging operations hut arc now 

more or less out of repair, Lake Superior and Mississippi River canal survey 

via Amnicon-Moose River. 


Location, etc. 

Purpose. 

About. 

Amnicon River, 22-46-13, 2 sluiceways. 

Logging operations 
.do. 

Feet. 

11 

9 

9 

9 

12 

9 

Amnicon River, 24-46-14. 

Moose River, 13-45-13, 1 sluiceway. 

.do... 

Moose River, 23-45-13, 1 sluiceway. 

.do... 

Moose River, 35-45-13, 2 sluiceways. 

.do... 

Moose River, 14-44-13, 2 sluiceways. 

.do... 




Results of gaugings, Lake Superior and Mississippi River canal survey via 

Amnicon-Moose and St. Croix Rivers. 


Pate. 

Location, etc. 

Area of 

cross 

section. 

Mean 

velocity 

per 

second. 

Discharge 

per 

second. 

Oct. 17. 

AMNICON RIVER. 

SW. 17-48-12, bottom gravel and bowlders. 

Sq.feet. 

23.25 

Feet. 

0. 85 

Cu.feet. 

20 

26 

10 

10 

6 

19. 

NW. 7-47-12, bottom gravel and sand. 

44.0 

.59 

19. 

NW. 12-47-13, bottom gravel and sand. 

9.25 

1.067 
. 84 

21. 

NW. 11-47-13, bottom gravel and bowlders. 

11.38 

21. 

N. line 14-47-13, bottom gravel and sand. 

8. 75 

.70 

.42 

24. 

SE. 11-46-13, bottom gravel and bowlders. 

17.75 

7 

Oct. 21. 

LITTI.E AMNICON. 

SW. 11-47-13, bottom gravel and sand. 

3.75 

.48 

2 









































WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 43 


Results of gaugings, Lake Superior and Mississippi River canal survey via 
Amnicon-Moose and St. Croix Rivers —Continued. 


Date. 

Location, etc. 

Area of 
cross 
section. 

Mean 

velocity 

per 

second. 

Discharge 

per 

second. 


BLACK RIVER. 






Sq. feet. 

Feet. 

Cu. feet. 

Oct. 23. 

SW. 27-47-14, bottom gravel and bowlders 

25 0 

0 44 

11 

24. 

Center 4-46-14, bottom gravel and bowlders 

21 5 

48 

10 

24. 

SE. 8-46-14, bottom gravel and bowlders. 

53.5 

.17 

9 


AMNICON RIVER. 



Oct. 24. 

24-46-14, bottom gravel and bowlders. 

39. 1 

.27 

10 


MOOSE RIVER. 



Oct. 30. 

SE. 23-45-13, bottom gravel and bowlders. 

10.1 

1.10 

11 

Nov. 1. 

SE. 12-44-13, bottom gravel and bowlders. 

10. 5 

.58 

6 

2. 

SE. 14-44-13, bottom gravel and bowlders. 

9.93 

.54 

5 

5. 

75 feet above month of river, bottom gravel and sand 

45.11 

.31 

14 


ST. CROIX RIVER. 



Nov. 5. 

50 feet below confluence with Moose. 

144.6 

1.19 

172 







List of possible dam sites found along the rivers explored which are suitable 
for the storage of water or canalizing purposes. 

Lake Superior and Mississippi River canal survey via Amnicon-Moose Rivers. 


Location. 


Height of 
dam 
possible 
(approxi¬ 
mately). 


AMNICON RIVER. 


SE. 18-4.8-12. 

SE. 29-48-12. 

SE. 7-47-12 (site of old dam now all gone). 

SE. 23-47-13. 

NE. 26-47-13. 

SE. 35-47-13. 

SE. 2-46-13. 

NE. 11-46-13. 

NE. 23-46-13. 


100 

80 

25 

35 

30 

20 

58 

60 

18 


MOOSE RIVER. 


SE. 13-45-13 (old dam can be raised to) 
SE. 23-45-13 (old dam can be raised to) 
SE. 35-45-13 (old dam can be raised to) 
SE. 14-44-13 (old dam can be raised to) 

NE. 23-44-13. 

SE. 27-44-13. 


15 

15 

27 
15 

28 
26 


The list of possible dam sites includes only such sites as particularly at¬ 
tracted attention because of topography and other features which rendered the 
location specially suitable for such purpose. 

In this report I have endeavored to make clear the results of my examina¬ 
tion of the Amnicon-Moose River route made in compliance with your instruc¬ 
tions of October 14, 1912. 

The map and profile, together with data given in this report, are as accurate 
as can be obtained from a survey of this nature, and may safely be used for 
approximate estimates. 

G. A. Taylor. 
















































APPENDIX B 


STATEMENT MADE BY JULIUS H. BARNES, ACTING CHAIRMAN AND REP¬ 
RESENTING THE PUBLIC AFFAIRS COMMITTEE OF THE COMMERCIAL 

CLUB, DULUTH, MINN., AT THE PUBLIC HEARING HELD JANUARY 15, 

1913, AT DULUTH, MINN. 

Mr. Barnes said: We have listened for so many hours to estimates and 
forecasts and imaginings and hopes of tonnage developments to be made by 
this proposed Lake Superior and Mississippi waterway that I almost hesitate 
to venture to record the opinion of myself and those whom I represent against 
this project, analyzing it in a commercial way. I am, however, delegated to 
speak the opposition of the Commercial Club of Duluth of 1,000 members after 
careful consideration against this project and, with your kind permission, will 
detail the reasons which lead us to this conclusion. 

One of the most recent works on waterway transportation, a volume by 
Harold P. Moulton, “ Waterways v. Railways,” analyzes the various water¬ 
ways which he has investigated. He refers to European waterways just cov¬ 
ered in the remarks of our friend, Mr. Harrison, but arrives at very different 
conclusions as to their justification from those expressed by our friends here. 
He sums up the situation somewhat as follows: 

“ It is agreed that since the traffic carried on the Great Lakes is tremendous 
in amount, we have there ample proof of the practicability of transportation 
by water; but a little reflection will show that no conclusion in support of 
river and canal transportation ought fairly to be drawn from the Great Lakes. 
They are a great natural highway similar to the ocean itself. They are of 
ample depth, free from current, and of great width. Moreover, they stretch 
in a general east and west direction through the heart of the continent and in 
the very pathway of our greatest commerce.” 

It is quite natural that we, who live in Duluth on those Great Lakes, and 
seeing the great economy of transportation because of this deep waterway 
should, perhaps, think the word “ waterway ” is one to conjure with and that 
anything which merits the name waterway must necessarily be an economy 
of transportation; but a study of this question has convinced us that there 
is a great difference between a great deep-water highway with only semi- 
occasional interruptions to remove or to improve and that of a shallow, ar¬ 
tificial waterway, every foot of which costs money and effort and a carrying 
capacity of which would in the end be very doubtful. 

That the Great Lakes themselves have justified themselves beyond any hope 
on the part of railroads of ever competing with them as a carrying facility 
is beyond question. I think Maj. Potter several years ago in a Government 
report first called attention to the fact that the saving in transportation costs 
in one season alone far more than offset the entire cost of all improvements 
since the beginning of our Government on these Great Lakes, including chan¬ 
nels and harbors as well. That this is, with the development to-day, far 
understating the condition is shown by the following figures: The season rate 
per ton of ore from the Head of the Lakes to Lake Erie ports for 1912 has 
been 40 cents per ton. The rail rate from the Head of the Lakes to Lake 
Erie ports on ore ranges from $3.75 to $4.50 per ton; a saving of $3.50 per 
ton on the single item of ore, the volume of which for this season through the 
Soo Canal was 46,303,000 tons, and here we have a saving of $162,000,000 on 
this item. 

The rate on grain for this season has averaged about 1J cents per bushel on 
the Lakes. The rail rate on grain between Duluth and Buffalo is 20£ cents per 
hundredweight or 12.3 cents per bushel, a saving on grain alone of 11 cents per 
bushel on this tonnage through the Soo Canal this year, amounting to 243,100,000 

44 



WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 45 


bushels, a saving in grain transportation costs of $27,000,000. Westbound the 
rate on coal between Buffalo and Duluth has been about 30 to 35 cents per ton. 
The rail rate on the same haul is $3.15 per ton, a saving on this one item west¬ 
bound through the Soo for 1912 on 14,931,000 tons of about $41,000,000; a total 
saving on three articles alone of $230,000,000 for the one season of 1912. 

The most recent figures I have seen of the estimates of expenditures of the 
Government in all directions on the Great Lakes has been about $100,000,000. 
One of the great transportation geniuses of this country is James J. Hill of 
St. Paul, the head of the Great Northern Railroad. Mr. Hill formerly ran a 
steamer on the Mississippi River below St. Paul. Evidently his judgment was 
such that he left the water transportation business on the river and took up 
railroading instead. He has always been a deep student of the transportation 
problem and I want to read into the records a public utterance of his on this 
point. This is a quotation from the evidence before the Interstate Commerce 
Commission, Docket 4335: 

“ Speaking of St. Paul, Mr. Hill got back to one of his favorite themes, the 
river. He said: ‘ St. Paul was the head of navigation, but the river had done 
but little good because Congress had not been able to lath and plaster the 
bottom. I would rather have a railroad along the river in spite of the com¬ 
petition because of the low grades it affords. A railroad that is well built, he 
declared, will give you cheaper transportation than you can get in any other 
way unless you can get 20 feet of water. I won’t compromise on 12 or 15.’ ” 

Now, we have the 20 feet of water. We have still some needs and improve¬ 
ments to develop along that 20-foot highway. No railroad can compete with it. 
But when you propose to build a 7-foot waterway, or an 8, 9, 10, or 12 foot 
waterway, I think the testimony of a transportation student like Mr. Hill is very 
pertinent regarding its commercial possibilities of competition in carrying. 

These gentlemen have argued that one of the important influences of a water¬ 
way, no matter how shallow, is the controlling of railroad rates. I have had a 
little practical experience of that in our own business as regards the Erie Canal. 
Twelve years ago we had a canal rate on grain from Buffalo to New York of 
21 cents per bushel. To-day we are paying the railroad paralleling that canal 
6 cents and the Erie Canal has 7 feet of water and is open seven months of the 
year, just the same as this canal proposed here. Why has it not been able to 
hold down railroad rates in that time? The answer is because its carrying 
possibilities on that depth are limited. The way to control railroad rates is by 
Federal control such as is being evolved now, and not pour the Federal treasure 
into commercially useless ditches. A short, shallow waterway is the height 
of folly. The transshipping charges at either end would kill its commercial 
possibilities. The waterway is limited in its possibilities. It can not reach to 
the individual farm, as a railroad can by its siding. It can not reach to the 
mines because mines are usually in hilly and mountainous country and water¬ 
ways can not be constructed in such a country. A railroad siding can run to 
the" very mine pit. A waterway can hardly reach the factories which need 
transportation facilities. The transportation facilities from a deep, practical 
waterway like the Great Lakes to a railroad should be the most important sub¬ 
ject for the investigation of our transportation expert. That is the problem 
that remains to be solved to give the full benefit to our great cheap waterway. 
In view of the rosy pictures painted by the advocates of these shallow water¬ 
ways and of the developments that follow its construction, it seems almost 
cruel to read a cold-blooded statement into this record. But I want to read 
this from the reports of 1909 (pt. 1, p. 15), of the Commissioner of Corpora¬ 
tions on this very subject. He says: “About 4,500 miles of canals have been 
constructed. More than one-half—2,444 miles, costing over $80,000,000—has 
been abandoned.” 

Gentlemen, the advocates of this canal are wrong, fundamentally wrong. 
There is no need for it; there is no tonnage to be developed by it; the tonnage 
which now exists would never move by it; and it would be a most glaring com¬ 
mercial failure. 


APPENDIX C, 


LETTER OF MR. J. A. LITTLE. 

Superior, Wis., March 1 /, 1913 . 

Gentlemen: At a hearing held at the Commercial Club in Duluth, Minn., 
January 15, 1913, before the Board of Engineers, to whom this communication 
is addressed, representatives of St. Paul, Minn., Stillwater, Minn., Duluth, 
Minn., and Superior, AVis., introduced statements of their views as to the 
advisability of and necessity for a survey of a proposed route for a canal to 
connect the Duluth-Superior Harbor and the Mississippi River. 

While it was generally understood that the discussion at this hearing was 
to bear largely on the desirability of surveying a canal route via the Amnicon, 
Moose, and St. Croix Rivers, most of the statements submitted were of a 
general nature, bearing on the necessity of and benefits to be derived from a 
canal via some feasible route between the termini. AVe shall proceed with our 
discussion on the theory that in order to warrant the expenditure of money 
by the Federal Government for this purpose, it must be shown that there is 
a present commercial necessity for this canal commensurate with the estimated 
cost thereof, and that the benefits of such a canal will be widespread and not 
confined to any one locality. It seems elementary to say that the Government 
should not expend a large sum of money without securing a substantial benefit 
to a sufficient volume of commerce. It seems equally true that such large 
expenditures of money can not be properly made to confer a specific advantage 
to one or two cities in their commercial competition with cities more favorably 
located on waterways on which the General Government has already expended 
large sums of money to make such waterways more efficient servants of the 
hinterland back of the port located thereon. To state our position concretely, 
we believe that careful analysis of the commerce which might be affected by 
the proposed canal will show that any benefit following the building of this 
canal would be confined almost entirely to the cities of St. Paul and Minne¬ 
apolis and would affect their ability to compete with the cities of Superior and 
Duluth for the great trade of the Northwest, which normally moves through 
Superior and Duluth. If the advantages flowing from the construction of a 
canal between Lake Superior and the Mississippi must come largely to the 
Twin Cities, the project is one which should be financed by the Twin Cities 
if undertaken at all and not by the Federal Government. 

In considering the business which would be affected by this canal we shall 
assume that whatever route was selected for the canal the distance from 
Superior to the mouth of the St. Croix is about 230 miles, and that the cost of 
such a canal and its annual cost of maintenance would be not less than the 
amounts estimated for such a canal via the Bride and St. Croix route, stated 
by Maj. Sears at $6,012,500 and $350,000, respectively. 

The advocates of this canal have submitted various estimates of the com¬ 
merce which would move between the Duluth-Superior Harbor and points in the 
upper Mississippi River Valley. The latest of these estimates was submitted 
in connection with the statements of Mr. Armson. I have not a copy of this 
statement, but I shall refer to some of .the estimates contained therein in a 
general way as I remember some of the most important tonnage items. 

Mr. Armson also called attention to a pamphlet, 1 copy of which was filed, en¬ 
titled “Report showing the commercial utility of proposed waterway,” sub¬ 
mitted to Lieut. Col. Graham D. Fitch, Corps of Engineers, May 31, 1909. by 
the Citizens’ Association of Stillwater, Minn. 1 have a copy of this pamphlet 


46 


1 Not printed. 






WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 47 


before me and wish to call your attention to some of the weaknesses of the 
general scheme of gathering and presenting data which was followed, as well 
as pointing out incidentally some of the 'most glaring errors therein contained. 
After a careful reading of the entire pamphlet I am utterly unable to deter¬ 
mine how the estimates of traffic presented were arrived at. There is no ex¬ 
planation of methods followed which would indicate that any special effort had 
been made to arrive at a conservative or accurate figure covering any com¬ 
modity. There is nothing to support a conclusion that these estimates are better 
than the wildest kind of a guess. Of course, every citizen of Superior and 
Duluth takes pride in the magnificent showing made by the commerce of the 
Duluth-Superior Harbor, but in spite of discriminatory railroad rates, which 
have long operated to build up the Twin Cities in their northwestern trade at 
the expense of Superior and Duluth, it taxes the belief of the most credulous 
to state that “ fully 75 per cent of this business is to and from St. Paul, Minne¬ 
apolis, and other cities located on or tributary to the Mississippi” (pp. 12 and 
13 of pamphlet). The report continues: “We present herewith a statement 
showing the receipts and shipments of a number of cities, as we have been able 
to gather them, regarding the bulk or heavy shipments of commodities which 
could be carried by canal at a considerable saving of freight rates.” It is gen¬ 
erally true that the larger the commercial center the more accurate are the 
figures obtainable representing the business transactions at that point. As an 
illustration of this rule it may be said that there is no accurate public record 
of the number of head and kinds of live stock shipped from each of the country 
shipping points to Chicago, South St. Paul, Sioux City, Kansas City, Omaha, or 
other large stock markets, but there is an accurate classified record of the re¬ 
ceipts and shipments of stocks and animal products at each of these markets. 
It is conceivable that errors would naturally occur in arriving at the tonnage 
of machinery, canned goods, general merchandise, etc., received from or 
shipped to Superior and Duluth by Minneapolis, but it is very hard to account 
for any considerable error in stating the shipments of flour, mill stuffs, and oil 
cake—products for which Minneapolis is famed the world over. 

At page 14 the shipments of these commodities from Minneapolis to Superior 
and Duluth are stated as follows for the year 1908: 

Tons. 

Flour_ 708,351 

Mill stuffs_ 129, 503 

Oil cake_ 11, 865 

Total___ 849,719 

During the 12 months ending December, 1908, there were shipped by 
water from Duluth and Superior the following tonnages: 

Flour.—Superior, 285,362 tons; Duluth, 143,628 tons; total, 429,990 tons. 

The figures for shipments from Duluth and Superior are from Marine Com¬ 
merce of Duluth-Superior Harbor, as compiled under the supervision of Lieut. 
Col. Graham D. Fitch, Corps of Engineers, then stationed at Duluth. As 
Minneapolis shipped 708,351 tons of flour to Superior and Duluth, and only 
429,990 tons were shipped from Superior and Duluth, there were left for con¬ 
sumption in Superior-Duluth and vicinity 278,361 tons of flour. The population 
of Superior and Duluth, combined, in 1910, was 118,850 persons. If the 
278,361 tons of Minneapolis flour, in excess of all lake flour shipments, were 
consumed in Superior and Duluth each inhabitant used 4,685 pounds of flour 
during 1908. If this tonnage were spread over Superior-Duluth and the “Iron 
Range,” composed of Lake, St. Louis, and Carlton Counties in Minnesota, each 
inhabitant must have consumed 2,418 pounds of flour in 1908. The report 
goes on to state St. Paul’s flour shipments to Superior-Duluth at 590 cars 
and says (p. 15) : “This, of course, does not include shipments passing through 
in transit.” Adding Stillwater’s 1,500 tons of flour shipped to Superior- 
Duluth during the same time, and assuming that a small part of the other 
points mentioned sent a small quantity of flour and that country mills in 
Minnesota, North and South Dakota, other than those specifically named, also 
shipped flour to Superior-Duluth, truly it must be said that some of the flour 
went down the lakes in phantom ships which escaped the watchful eye of the 
United States engineer, or the people of Superior, Duluth, and vicinity were 
wonderfully well supplied with the “ staff of life.” Not showing a clear state¬ 
ment of the “ theory ” on which such figures as these are arrived at, I can 
not see how any value can be attached to such an erroneous statement. If 







48 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


where the greatest accuracy could be expected there is manifest errors of such 
importance, what must be true of estimates coming from smaller cities where 
there is usually less effort to accurately record tonnage-movement figures? 

There seems to be a tremendous confusion of thought in the minds of some 
persons residing at points along the Mississippi River when it comes to esti¬ 
mating tonnage available for shipment on the proposed canal. A few in¬ 
stances will suffice to illustrate this point. Burlington, Iowa, is said to re¬ 
ceive some 30,000 tons of pig iron from the Lake Superior district at sixth- 
class rates. Freight shipments between the Lake Superior district and Bur¬ 
lington, Iowa-, district are governed by the western classification, in which 
there is no sixth class. Sixth-class rates apply from points east of Chicago 
to Burlington, Iowa, and therefore if 30,000 tons of pig iron were received at 
Burlington on sixth-class rates that must have been the territory in which 
the shipment originated. The pig-iron production for Illinois (outside of the 
Chicago district), Michigan, Minnesota, Wisconsin, Missouri, and Colorado, in 
1911, was 777,010 long tons, while the production in the Chicago district was 
2.954,709 long tons for the same period as reported in Internal Commerce of 
the United States, published by the Bureau of Commerce and Labor. It seems 
hard to believe that shipments “ from the Lake Superior district,” which must 
be a small factor in pig-iron production as compared with Chicago, would 
move over the Lake Superior and Mississippi Canal and Mississippi River 
to Burlington, about 600 miles, when pig iron does not actually move in any 
volume from Chicago to Burlington via the Illinois and Michigan and Hennepin 
Canals and the Mississippi River, a distance of about 300 miles. This situation 
as to pig iron will not be materially changed by the completion of the Minne¬ 
sota Steel Co.’s new plant at the Head of the Lakes, because there is no pro¬ 
vision for casting pig iron at this large modern plant, where the molten metal 
will be carried directly from the blast furnace to open-hearth steel furnaces, 
only such ore being reduced as will be necessary for the steel-making require¬ 
ments of the plant. Salt is shown as an item of tonnage of some importance, 
and in connection with this traffic it must be pointed out that the distance 
by lake from Michigan salt-producing points to Chicago is the same as or less 
than the distance from Michigan points to Superior, and that Chicago has long 
been an important salt-distributing point, yet La Crosse, Winona, Davenport, 
Burlington, and Keokuk do not receive salt from Chicago via the connecting 
canals and the Mississippi River. Why should we expect a traffic in this com¬ 
modity to move from Superior to the same points of destination over a similar 
water route and through a longer average distance? 

The secretary of the Davenport (Iowa) Commercial Club frankly says: 
“ You know, of course, that we have a water route from Lake Michigan to 
Mississippi River via Illinois and Hennepin and Michigan Canals. While prac¬ 
tically no use has been made of this waterway for through service up to the 
present time, the matter is receiving attention, and our shippers expect to receive 
substantial benefits from the same in the near future.” One end of this canal 
is at Chicago, near the center of manufactures in the United States, and the 
other end touches one of the richest agricultural States in the Union, yet there 
is no substantial utility resulting from the expenditure of some $16,000,000 of 
public funds. 

Among the many minor items of traffic said to be seeking a canal waterway to 
market, we find shipments of 45,000 tons stoneware and 70,000 tons of sewer pipe 
made at Red Wing, Minn. Sewer pipe and stoneware are very fragile commodi¬ 
ties which are much better suited to continuous shipments over the smooth wa¬ 
ters of a river and canal course than partly by canal, with the dangers of transfer, 
and partly by lake, subject to the rough-weatlier conditions often found on Lakes 
Superior and Michigan. This pamphlet says, “ The sewer pipe and pottery is 
largely Chicago business and could be shipped advantageously and at a saving 
by an all-water route.” The most complete refutation of this statement is found 
in the present existence of a suitable water route from Red Wing to Chicago, 
which is not used. Are we to conclude that this business would move north to 
Superior, be transferred there, and then proceed around “ the Horn ” via i.akes 
Superior and Michigan to Chicago, when it will not move by river and canal over 
a shorter route? If this is sound logic we may expect a tremendous growth in 
the traffic between New York and Seattle around Cape Horn after the opening 
of the Panama Canal. 

What traffic, then, may be expected to develop on this canal? 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 49 


LOCAL TRAFFIC ALONG THE CANAL ROUTE. 

The Northern Wisconsin territory along the route of the canal is adapted espe¬ 
cially to dairying, small fruit raising, and truck farming. Along the southern end 
of the canal dairying and potato raising are the principal farm occupations, while 
the small grains raised are largely rye and barley, which are produced in com¬ 
paratively small quantities. In marketing the products of the dairy, small fruit 
or truck farm, everything depends upon quickness of delivery to point of con¬ 
sumption, so we could not expect such business to patronize the canal. The po¬ 
tato crop would not begin to move until about the time the canal season of navi¬ 
gation was over, so a very small tonnage would be derived from this source. The 
rye and barley raised finds its biggest market at Milwaukee, St. Louis, and the 
Southeast, where the largest breweries and distilleries are located. If a water 
movement of this traffic were to he expected at all, it would be south, via the 
Mississippi, through St. Louis. This statement would hold true for the coarse 
grains produced along the Mississippi in southern Wisconsin, southern Minne¬ 
sota, Iowa, and Illinois. 

Other Traffic Which Might Use the Proposed Canal, and the Probability 
of Such Use in View of Railroad Rates and Commercial Conditions. 

GRAIN TRAFFIC. 

For the reasons stated in the previous paragraph there would be no sub¬ 
stantial movement of grain from grain-growing territory in Wisconsin, Minne¬ 
sota, Iowa, and Illinois, lying adjacent to the Mississippi and south of St. Paul. 
The production is contined largely to coarse grains which do not usually seek a 
market through the port of Superior-Duluth, but in an opposite direction. 
The principal wheat-producing section lies west of Minneapolis and north of a 
line drawn due west from St. Paul, including central and northern Minnesota, 
northern South Dakota, all of North Dakota, and parts of Montana. From Mon¬ 
tana and practically all of North Dakota and northern and northwestern Minne¬ 
sota the freight rates on grain are the same to both Minneapolis and Superior. 
From South Dakota and southwestern Minnesota Minneapolis rates are from 
2 to 4 cents per hundred less than the rates from the same points to Superior. 
In the larger part of the territory the differentials are 2 and 3 cents. The 
grain coming from this territory is largely wheat which is either milled at the 
Twin Cities going forward from that point as flour, is shipped from the Duluth- 
Superior harbor east by lake to be milled in consuming territory, or is milled in 
transit at small interior mills from which the product goes east to the larger 
consuming territory. Mills located at points south of the Twin Cities on the 
Mississippi either buy in the grain fields to grind in transit for Chicago terri¬ 
tory, or east thereof, or would naturally buy from the Twin Cities to fill their 
requirements, as the rates into the Twin Cities are equal to or less than those to 
Superior, while the rates from the Twin Cities to the mill are less than from 
Superior. The price of No. 1 Northern is the same or higher in the Duluth- 
Superior market than at the Twin Cities, therefore grain purchased at Superior 
or Duluth would always cost the purchaser, at Winona or La Crosse, for in¬ 
stance, the difference in price if any between Minneapolis and Duluth plus the 
higher cost of transportation by rail or canal from Superior to the Twin Cities, 
as compared with the short rail or river haul from the Twin Cities to La Crosse 
or Winona. The situation here depicted holds true of other commodities origi¬ 
nating at points along the Mississippi and destined to northwestern consuming 
points. For example, the rates from Superior-Duluth to Grand Forks, N. 
Dak., are the same as from St. Paul to Grand Forks. Pottery or sewer pipe 
from Red Wing, destined to Grand Forks would naturally go through St. Paul, 
because the local rail rate to St. Paul is less than to Superior-Duluth, or the 
Mississippi River to St. Paul would be used instead of the river and canal to 
Superior, because of the smaller expense for the short haul. Such classes of 
prospective traffic as this can not be said to demonstrate the economic necessity 
of a canal from the Mississippi to Lake Superior. 

Grain, as stated before, comes to Minneapolis on the basis of a local rate 
which is: The same as the rate to Superior or from 2 cents a hundredweight, 
or 40 cents a ton lower to 4 cents a hundredweight, or 80 cents a ton lower 
than the rate to Superior. Grain coming from points where the shipments 


H. Doc. 100S, 64-1-4 



50 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


route through the Twin Cities may he stopped at Minneapolis and offered for 
sale on that market and failing, such sale may be forwarded to Superior or 
Duluth on practically the same rate basis as if the shipment traveled through 
to destination without stopping in transit. Shipments coming from territory 
which would not route through the Twin Cities may be forwarded to Superior- 
Duluth at 5 cents a hundredweight, or $1 a ton more than the local rate to 
Minneapolis. 

On the basis of a margin of 40 cents, 60 cents, SO cents, or $1 a ton would 
grain move through Minneapolis via the Mississippi River and Canal to Superior 
or Duluth, if all proper charges were assessed against the traffic? The New 
York State canals would present conditions of operation similar to the pro¬ 
posed canal, having regard to the depth of water and type of barge. 

Below we present some statistics which should throw considerable light on 
the fair operating cost of this canal. 

Statistics for New York Canals from Census Reports on Transportation by 

Water in 1906. 


Cost of proposed canal_$0, 012, 500 


Interest per annum, at 3 per cent_ ISO, 375 

Maintenance cost per annum based on Maj. Sears’s report_ 350, 000 


Total interest and maintenance per annum_ 530, 375 


Number of tons required to pay interest and maintenance at 40 

cents per ton_ 1, 325, 917. 5 

Number of tons required to pay interest and maintenance charged 

at 20 cents per ton_ 2, 651, 875 

Total tons transported on New York canals_ 3, 540, 907 

Tons of through freight on New York canals_ 1, 006, 414 

Tons of way freight on New York canals_ 2, 534, 493 

Wages of employees on New York canals_ $726, 402 

Wages of employees per ton carried on New York canals 

($726,402 divided by 3,540,907)_ .205 

Value of canal boats on New York canals_ 2, 952,197 

Interest on value of canal boats at 6 per cent_ 177,131. 82 

Interest on boats per ton carried ($177,131.82 divided by 
3,540,907)_ .05 

Cost of elevation at Mississippi River per bushel, cents_ . 05 

Cost of elevation at Mississippi River per ton, cents_15. 65 

Cost of elevation at Superior-Duluth harbor per ton, cents_15. 65 


The cost of elevation per bushel is based on the cost at Buffalo as stated on 
page 315 of the 1911 Statistical Abstract of the United States. 

Cost per ton for interest on wheat delayed in transit (wheat at 90 cents 
per bushel and canal and river time estimated at 5^ days against 24 hours’ 
rail transit), 2 cents. 

The above estimate is for movement only and takes no account of probable 
delay in switching to elevator on the river or for delay in river transfer 
elevator due to congestion and irregularity of canal-boat traffic. 

Cost of switching, if from Minneapolis local elevator, to river-front trans¬ 
fer elevator near St. Paul, based on switching charges in G. N. I. C. C. A 3140, 
per ton, 20 cents. 

If from connecting line to St. Paul water front, through business, 10 cents 
per ton. 























WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 51 


Cost per ton St. Paul or Minneapolis to Superior: 



If total 
tonnage 
moved 
were, 
1,325,937.5 
tons. 

If move¬ 
ment 
were, 
2,651,875 
tons. 

For interest on cost of canal and maintenance.cents 

Waces of employees. 

40 

20 5 

20 

20.5 

Interest on investment in boats. 

5 

5 

Cost of elevation at river. 

15.65 

15.65 

Delay in transit. 

2 

2 

Switching from connecting line to St. Paul water front on through business. 

10 

10 


If from Minneapolis local, add 10 cents for switching i. 

93.15 

10 

73.15 
10 



103.15 

83.15 


1 Switching Minneapolis to St. Paul 20 cents per ton, as compared with interchange switch of 10 cents 
per ton. 


It is apparent that under the above conservative statement of costs, which 
takes no account of insurance cost, higher wages for employees paid in the 
Northwest, as compared with New York or higher cost of materials for boats, 
as compared with the East, and extremely low estimated elevation charges at 
Buffalo, which probably could not be equaled on a less efficient plant handling a 
smaller business on the Mississippi water front at St. Paul, there could be no 
substantial movement of grain on the proposed canal from the Twin Cities to 
Superior. 

WOULD FLOUR MOVE ON THIS CANAL? 

The railroads owning docks at Superior or Duluth offer free storage for flour 
for lake shipment, which enables the Minneapolis miller to have a large amount 
of his product at the port to move at the opening of the lake season of naviga¬ 
tion long before a similar amount of his products could be moved via the canal 
for early shipment. In addition to hastening the actual movement of his 
product, the placing of these goods in transit before the assessor gets around in 
the spring saves the taxes which would be assessed on these products if they 
were in the mill warehouse awaiting shipment via the canal. On anything like 
equal costs of movement via the canal compared with rail movement, the privi¬ 
lege of storage at railroads’ docks and the opportunity to escape the spring 
assessment of taxes would give the rail route a very large proportion of the 
shipments. The lake-and-rail rate on flour from Minneapolis to eastern destina¬ 
tions is 5 cents per hundredweight, or $1 per ton greater than the lake-and-rail 
rate from Superior to the same destination. Using the figures previously given 
for grain and substituting a conservative estimate of 35 cents per ton for ware¬ 
housing and handling from car to boat at St. Paul for the elevation charge 
previously shown, it appears that shipments moving via St. Paul rail and canal 
to Superior would cost from ,$1.04 to $1.24 per ton, if from Minneapolis local, 
or from 94 cents to $1.14 per ton if from points beyond. As before stated, these 
figures do not include anything for marine insurance and other proper charges. 

The above estimates for handling flour are higher than rail costs, without 
charging a cent against the traffic for warehousing and handling at the Lake 
Superior destination. No substantial movement could therefore be expected. 

COAL. 

The United States Geological Survey production of coal in 1909 places the 
amount of coal mined and prices at mines as follows: 



Shipments. 

Price 
per ton. 


Tons. 
46,595,285 
43,946,303 

$1.05 
.86 

WmI Vtrm - 7ii» .. 



























52 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Tlie largest volume of coal moving through the Duluth-Superior harbor is 
soft coal coming very largely from West Virginia. The rail rate on coal from 
a large group of Illinois points to St. Paul-Minneapolis is $1.40 per ton. Add¬ 
ing freight to average mine cost stated above, Illinois coal would sell on the 
St. Paul-Minneapolis market at $2.45 per ton plus storage, handling, and 
dealer’s profits. The rail rate from a large part of the West Virginia coal 
mining territory to Lake Erie points when for lake shipment is 80 cents per 
ton. The lake rate from Lake Erie to Superior is 30 cents per ton, and 
the rail rate from Superior to St. Paul is 90 cents per ton. Mine cost 86 cents 
plus transportation expenses of $2 through Superior to St. Paul makes West 
Virginia coal worth $2.86 per ton plus cost of handling at Superior-Duluth 
docks (3 cents per ton, boat to dock plus 10 cents from dock to car), 13 cents 
would mean a total cost of $2.99 a ton at St. Paul plus storage and handling 
at St. Paul and dealer’s profits. It is apparent that Illinois coal shipments 
directly limit the amount of Eastern coal, which can be sold at the Twin 
Cities. A reduction of 54 cents a ton in the rate from Superior to St. Paul 
would be necessary to make the cost of laying West Virginia coal down in 
St. Paul the same as the cost for Illinois coal. Reliable statements from coal- 
dock officials at Superior indicate that less than 25 per cent of the coal re¬ 
ceived at the Superior-Duluth harbor is shipped to St. Paul and Minneapolis. 
In general it may be said that the largest movement of coal from Superior and 
Duluth docks does not take place until about what would be the close of a 
canal season of navigation, which would reduce very materially the tonnage 
available for canal shipment. The present system of handling the coal busi¬ 
ness is based on the storage of tremendous coal supplies at Superior and 
Duluth and shipment to retailers and manufacturing plants at times which 
suit their convenience and allow plants to keep their current investment in 
fuel down to the lowest possible point. In order to ship coal by canal to the 
Twin Cities, it would be necessary to make large coal-stock piles at or near St. 
Paul on the Mississippi River. The necessity for keeping various advertised 
individual kinds of coal separate and the small volume of each concern’s busi¬ 
ness handled at such points would not warrant the installation of expensive 
handling machinery to transfer coal shipments from the barges to the dock 
and from the stock pile to cars. In loading coal by hand from stock pile to 
car a cost of from 30 cents to 40 cents per ton is incurred for handling. This 
is the experience of operators of Superior coal docks. If to this handling 
charge we add something for return on barges, wages of canal employees, and 
switching from stock pile on the Mississippi to points in St. Paul or Min¬ 
neapolis, it must be apparent that no substantial saving under present rail 
rates would be effected. In addition to the items of cost already mentioned, 
something would necessarily have to be added for rent of dock space or land 
on the Mississippi River, as well as losses due to additional handling received 
by the coal. That losses from handling coal are substantial is attested by the 
fact that coal docks located at Superior have installed the largest briquetting 
plants in the United States, if not in the world, to put coal screenings and 
dust in marketable form. It is confidently stated that the most thorough inves¬ 
tigation will fully substantiate what has been said above, and it is our sincere 
belief, therefore, that the estimated traffic in coal, grain, and flour would not 
materialize. 

As to iron and steel goods, canned goods, sugar, salt, and cement from eastern 
points of production it is only necessary to point out that the present lake and 
rail rates to the Twin Cities are but 2 cents per hundredweight, or 40 cents per 
ton, more than the rate to Superior and that a certain amount of free storage 
in transit is allowed on the Twin City business. The 40 cents per ton difference 
would not go far to provide for handling charges at St. Paul and switching 
from docks to warehouse, to say nothing of the free-storage privilege which 
would be lost to manufacturers or jobbers. 

What, then, is the reason why people of the Twin Cities and immediate 
vicinity wish to see this canal built? The Twin Cities have long been the 
beneficiaries of a system of discriminatory lake-and-rail rates. Communities on 
all sides of them, including Kansas City, Sioux City, Mankato, Albert Lea, and 
Red Wing, have complained to the Interstate Commerce Commission of such 
discriminations. There is now pending before the Interstate Commerce Com¬ 
mission a complaint of the Duluth Commercial Club against these unjustly 
discriminatory rates. A canal from Lake Superior to the Mississippi River 
would give theoretical or “potential” water competition which would go far 
to justify and perpetuate the iniquitous system of rates which now exists. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 53 


Some of those who favor this canal have contended that the canal would 
“ regulate ” freight rates. Ever since February 4, 1887, and more especially 
since the passage of the Hepburn and Mann-Elkins laws of 1906 and 1910, the 
Federal Government has taken the position that railroad rates and fares can 
and must be regulated by an administrative body clothed with adequate powers 
to investigate and decide such questions. 

If the communities interested in the building of this canal are not receiving 
fair treatment at the hands of rail or rail-and-lake carriers they should seek 
redress through the Interstate Commerce Commission, not through the expendi¬ 
ture of some $6,000,000 or more of public funds, which might not prove efficient 
in either regulating rail rates or serving commerce, as would seem to be the 
case with the Illinois-Michigan-Hennepin canals connecting Lake Michigan and 
the Mississippi River. All of which is respectfully submitted. 

Yours, very truly, 

J. A. Little, City Statistician. 

Lieut. Col. Chas. L. Potter, 

Lieut. Col. Francis R. Shunk, 

Capt. E. D. Peck, 

Corps of Engineers • 


i 


APPENDIX D. 


LETTER OF THE PUBLIC AFFAIRS COMMITTEE OF THE COMMERCIAL 

CLUB OF DULUTH. 

Duluth, Minn., January 23, 1913, 

Dear Sir: In considering the commercial possibilities of a canal from 
Lake Superior to the Mississippi River, it seems proper and fair to take up the 
movement of various commodities between Duluth-Superior Harbor and the 
Twin Cities, both locally and destined to points beyond, the volume of such 
movement in total, and during both the open and closed seasons of navigation 
upon the canal, the railroad rates for the transportation of such commodities, 
the service performed by the railroads as compared with that which might 
reasonably be performed by the canal, the railroad rates for such transporta¬ 
tion, and the possibility of rates being made for transportation on the canal 
low enough to attract traffic from the rail lines and affect the rail rates. 

As the southbound movement will probably considerably exceed the north¬ 
bound shipments in the future, to at least as great an extent as at present, con¬ 
sideration will be given to that traffic first. 

COAL MOVEMENT. 

For the season of 1911 there were received by lake at Duluth-Superior Har¬ 
bor 1,364,568 tons of hard coal and 7,070,337 tons of soft coal. 

Hard coal is used mainly for house heating during the winter months, and 
the shipments from the head of the Lakes move almost exclusively during the 
late fall and winter, when the canal would be closed to navigation. It therefore 
seems fair to eliminate the hard-coal tonnage, unless it can be shown that the 
rates on the canal can be made low enough to warrant the shipping, prior to 
the close of the canal, of large quantities for storage at the Twin Cities or 
other points. This feature will be taken up later. 

Soft coal is used the year round, but a much greater tonnage is consumed 
during the winter months than during warm weather, as this class of coal 
is used largely in the heating of large buildings, and even steam plants require 
more-fuel during the winter than in the summer. 

Presuming for purposes of argument that the demand is uniform throughout 
the year and the shipments each month are about equal, the largest estimate 
presented at the hearing was that 50 per cent of the receipts at Duluth-Superior 
Harbor goes to the Twin Cities and beyond. Fifty per cent of the 1911 receipts 
of soft coal was 3,535,168 tons, equal to 294,597 tons per month. The canal 
would not be open for traffic over seven months in the year, and for that period 
2,062,179 tons would move under normal conditions. This movement, like that 
of hard coal, is dependent upon the canal rates and service. 

SERVICE. 

Coal transported by rail is loaded into cars at the docks at the head of the 
Lakes and delivered next day to consignees in any part of the Twin Cities with¬ 
out any additional charge beyond the freight rate from Duluth to St. Paul. 
Shipments by canal would have to be unloaded and loaded into cars for delivery 
at points of destination not located on the canal. Coal transported by canal 
could not be delivered to consignees in the Twin Cities in less than five days on 
the average. 

The price of coal f. o. b. cars at Duluth is 25 cents per ton less than the price 
of the same coal f. o. b. barges at Duluth. The deterioration on coal in the 
transfer from barges to cars is estimated by the coal-dock managers at Duluth- 
Superior Harbor to be about 20 cents per ton. The charges at the Twin Cities 

54 



WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 55 


for moving coal from the canal terminals to industries or team tracks would be, 
on a distance tariff basis, as follows: 

Miles. Rate. 


Cents per 100 pounds_ 5 3 

Do_10 3 

Do_15 3 

Do_20 4 

Do_25 5 

Do_30 5 

Do_35 6 

Do_40 6 


The rates from the canal terminal to destinations on rail lines would depend 
upon the location of the canal terminals. 

To sum up, the cost of delivering coal from Duluth to on board cars at the 
canal terminals, exclusive of the charge for transportation on the canal, would 
be substantially as follows: 

Per ton. 


Extra charge for loading barges_$0. 25 

Deterioration___ . 20 

Transfer barge to car_ . 15 


Total_ • 60 


The rail rates from Duluth to the Twin Cities are $1.25 per ton on hard coal 
and 00 cents per ton on soft coal, leaving 65 cents per ton on hard coal and 30 
cents per ton on soft coal to cover the canal charge from Duluth to the Twin 
Cities and the rail charge from the canal terminal to final destination in the 
Twin Cities. 

From this it would seem doubtful if the canal could equal the rail rates, and 
practically impossible for the canal to offer rates enough lower than those of 
the rail lines to attract any considerable tonnage for the Twin Cities locally. 

As to coal traffic from Duluth destined to points beyond the Twin Cities 
which might move by canal, the rail rates from Duluth to such destinations 
are substantially the same as the rates to the same points from Lake Michigan 
ports and from mining points in Illinois. The following table shows the rates 
from Duluth to representative points beyond the Twin Cities and the local 
rates from St. Paul: 

Rates pei' net ton. 


To— 

Through rate. 

Local from St. 
Paul. 

Soft. 

Hard. 

Hard 
and soft. 

Hard. 


$1. 40 

$2. 25 

$2.00 



1.40 

2. U) 

1.60 



1.40 

2. 00 

1.80 



1.40 

2.00 

2.00 



1.50 

2.05 

1.65, 



1.80 

2.05 

1.60 



2.00 

2.25 

1.85 

$2.15 

0,V„ v TTolIc Q Dolr .*. 

2.40 

2. 50 

1.25 

2. 50 

blOUX rails, o. .. 

2. 55 

2. SO 

2.15 

2.35 


2. 55 

2.80 

2. 55 

2.80 







MERCHANDISE. 


Westbound general merchandise traffic destined to the Twin Cities is handled 
on through rates, which are the following differentials higher than the rail-and- 
lake rates to Duluth, governed by official classifications: 


Classes 


1 2 3 4 5 6 


Cents per 100 pounds 


15 13 9 5 4 2 













































56 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Iron and steel articles, 2 cents. 

A very large percentage of special, commodity rates, 2 cents. 

The canal boats could not reduce these figures and live. 

The lumber manufactured in Duluth is shipped east by lake. 

This is substantially of the southbound traffic. 

N OUT H BOT.TN D. 

The claim has been made that flour, grain, and manufactured articles will 
furnish a heavy northbound tonnage. 

The mills at Minneapolis are located above any possibility' of navigation 
on the Mississippi River, so far as the proposed canal is concerned, therefore 
there will be a rail movement from the mills to the canal. The transfer, 
estimated from the experience at Duluth in unloading from cars and loading 
on board vessels, would be 30 cents per ton. The same charge would be made 
at Duluth for transferring from barge to lake vessels. This would make a 
charge of 60 cents per ton for handling alone. The proportional rate on flour 
by rail from Minneapolis to Duluth is 5 cents per 100 pounds, or $1 per net 
ton. Deducting the canal handling charges, leaves 40 cents per ton out of 
which to pay the rail charges from the mills to the canal and the charges for 
canal transportation to Duluth. 

Flour and package freight can not be handled to advantage in the same type 
of barge as coal and other bulk commodities, and a coal barge would have to 
be thoroughly cleaned before loading with flour. 

Grain is not shipped locally from the Twin Cities to Duluth. Such grain is 
handled on a proportional rate not exceeding 5 cents per 100 pounds, or $1 
per ton. The bulk of the grain moving from Minneapolis to Duluth is handled 
on through rates from points of origin to Duluth. 

The through rates from points on the Great Northern Railway in south¬ 
western Minnesota, Iowa, and South Dakota to Duluth in no case exceed 
the rates from the same stations to Minneapolis by more than 3 cents per 100 
pounds, or 60 cents per net ton. 

In order to attract grain shipments to the canal, a rate materially lower 
than 60 cents per ton would have to be made between Minneapolis and Duluth.. 
Grain could not be handled in a coal barge unless the barge was subjected t.o 
a thorough cleaning before the grain was loaded. The elevators in the Twin 
Cities are not located so as to load direct to barges. This would necessi¬ 
tate a rail movement from elevator to barge and a transfer charge of at least 
20 cents per ton from car to barge. 

On all merchandise traffic through Duluth, both east and west bound, there 
is a dockage charge of 40 cents per ton, which is absorbed by the rail lines. 
Some arrangement would have to be made by the canal boats to take care of 
this charge. 

AIL of the rail rates include insurance against loss and damage. The 
matter of claims has not yet been referred to, as it does not seem necessary 
to go further into details in view of the impossibility of the commercial 
success of the canal. 

The rail rates are so adjusted and the transportation conditions so un¬ 
favorable to canal traffic that there seems to be very little possibility of rates 
being made on the canal, which, added to the various charges incidental to 
transportation via that agency, would meet the rail charges, and no possibility 
of canal rates being made low enough to influence the movement of traffic 
by rail or affect the rail rates. 

All of which is respectfully submitted. 

Yours, very truly, 


Capt. E. D. Peek, 

Corps of Engineers, 


G. Roy Hall, 

Traffic Commissioner. 


APPENDIX E. 


LETTER OF THE CITIZENS’ CANAL COMMITTEE IN THE MATTER OF THE 
PROPOSED LAKE SUPERIOR-MISSISSIPPI CANAL. 

Sirs : In response to your circular letter of November 19, 1912, requesting 
information from interested persons on the character, amount, and value of 
commerce that would be affected directly or indirectly by the proposed canal 
connecting Lake Superior with the Mississippi River, the St. Croix River Im¬ 
provement Association and the Citizens’ Association of Stillwater, Minn., ap¬ 
pointed the undersigned committee to gather such data as might be available, 
and to compile and submit the same to you for your information. 

In the circular letter above referred to information was particularly desired 
on the following points : 

(a) The present and prospective business of the locality in character and 
amount, development of water power, etc., and particularly the kind and 
amount of vessel commerce and present facilities for conducting the business, 

(b) What kind of improvement is desired by those who caused the above 
items to be inserted in the river and harbor bill. 

(c) With reference to the proposed canal, the character and amount of com¬ 
merce and its value that would probably be carried by the proposed canal, or 
that would be affected directly or indirectly by it; the extent to which it 
would probably promote the general business or industries in any localities 
or sections of the country, and any other data which might have a bearing 
upon the question in hand. 


SUBDIVISION A. 

The information requested in subdivision (a) in reference to the present 
and prospective business in character and amount of the localities that would 
be affected by the proposed canal will be included in our response to the ques¬ 
tions contained in subdivision (c). 

In the matter of the development of water power, this committee is unable 
to submit any reliable data on this subject for the reason that no survey of 
the proposed canal route between Lake Superior and the St. Croix River by 
way of the Amnicon and Moose Rivers has yet been made, and until at least 
a preliminary survey is made, it would be impossible to report on the probable 
water power that could be developed on these rivers. 

It was conservatively estimated that more than 50,000 horsepower could be 
developed on the route by way of the Brule River and Upper St. Croix Lakes 
surveyed under direction of Maj. Clinton B. Sears, Corps of Engineers, in 1S95, 
but we are unable to say whether the amount would be greater or less on the 
Amnicon-Moose River route. 

In reference to the kind and amount of vessel commerce and the present 
facilities for handling the same, we assume that this question refers more par¬ 
ticularly to the Duluth-Superior Harbor, upon which we have no information 
to offer. 

SUBDIVISION B. 

The improvement desired is a barge canal. The width and depth of such a 
canal is entirely an engineering matter. Maj. Sears’s estimate of the cost of 
such a canal was based on a width at the water surface of SO feet, 59 feet wide 
at the bottom, and 7 feet deep. It has been suggested that a depth of 8 feet 
would add greatly to the carrying capacity of the canal. Upon this subject, 
however, we have no suggestions to offer, but simply call attention to the sug¬ 
gested depth of 8 feet. 


« 


57 



58 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER 


SUBDIVISION C. 

In a report submitted to Lieut. Col. Graham D. Fitch, Corps of Engineers, 
under date of May 31, 1909, by a committee of the Citizens’ Association of Still¬ 
water, Minn., a copy of which is hereto attached, 1 the character and amount of 
commerce that would probably be carried by the proposed canal, and the prob¬ 
able effect it would have on freight rates was covered in considerable detail. 
The data submitted at that time has been revised and brought down to date by 
the present committee, a summary of which is herewith attached for your 
information. 

The territory that would he affected, either directly or indirectly, by the 
building of the proposed canal embraces practically all of the five States border¬ 
ing on the Mississippi River—Minnesota, Wisconsin, Iowa, Illinois, and Mis¬ 
souri. These States contain a population of more than $16,000,000 people and 
have an area of 310,815 square miles. They are among the most prosperous 
and progressive States of the Union. The- varied resources and wonderful 
fertility of the Mississippi Valley justifies the opinion that eventually it will 
he one of the greatest and most populous sections of our country. It is not 
unreasonable to estimate that these States will have a population of at least 
25,000,000 people within the next 20 years. 

During the past 20 years the industrial and commercial growth of the Mis¬ 
sissippi Valley has far outstripped its growth in transportation facilities. 
This unequal growth has resulted in frequent freight congestion in the com¬ 
mercial centers of the Middle West in recent years and has adversely affected 
our industrial development. It is highly improbable that these congested con¬ 
ditions will he relieved by increased railroad facilities in the near future. An 
eminent railroad authority, Mr. James .T. Hill, estimated a short time ago that 
ii; would take $5,000,000,000 to furnish the railroads of the country with ade¬ 
quate facilities in trackage, terminals, and rolling stock to enable them to 
properly care for the traffic of the country. 

These conditions make it imperative that we should utilize our waterways 
for transportation, especially for the transportation of heavy and bulky com¬ 
modities. It is estimated that it would take $500,000,000 to put all the prin¬ 
cipal waterways in condition for profitable steamboat and barge transporta¬ 
tion—just one-tentli of what Mr. Hill says is needed for perfecting the railroad 
system. It is possible that by the time that Mr. Hill’s $5,000,000,000 was ex¬ 
pended on railroads, traffic will again have so increased as to demand a yet 
further laying of tracks and expansion of terminals, while waterways once 
constructed admit of indefinite expansion of traffic without enlargement. 

It is not necessary, however, to dwell on the economic value of waterways in 
the development of the industrial and commercial welfare of a country. Such 
value is now generally recognized by every thoughtful student of transporta¬ 
tion problems. In considering any comprehensive scheme of waterways de¬ 
velopment, however, the value of each specific project must in the end be deter- 
mined by its commercial utility. It is our purpose, therefore, to present in this 
report certain facts and data bearing on the commercial value and utility of the 
proposed canal connecting Lake Superior with the Mississippi River. 

We believe that such a canal would he of immense value to the entire Upper 
Mississippi Valley, as well as the adjacent territory. The cheaper freight rates 
afforded by water transportation as compared with rail would greatly stimulate 
trade and commerce and would aid materially in our industrial progress. The 
saving in the cost of transporting such heavy articles of commerce as coal, 
iron, lumber, cement, lime, salt, sugar, heavy hardware, and building and 
crushed stone would alone justify the building of such a canal. 

As coal and iron constitute the greater part of the cost of a large and grow¬ 
ing line of manufactured products, and as the future industrial growth of the 
Mississippi Valley will depend largely on the availability and cost of these com¬ 
modities, the value of the proposed canal as affording the cheapest possible 
method of transporting these important articles of commerce will be first 
considered. 

In the territory tributary to the proposed canal the consumption of coal is con¬ 
servatively estimated to exceed 10,000,000 tons annually. The receipts of coal 
in the Duluth Superior Harbor alone in 1911 exceeded 8,500,000 tons. At least 
60 per cent of the latter is shipped to the Mississippi and Minnesota River 
Valleys. The present rail rate to St. Paul and Minneapolis is $1.25 for hard 


1 Printed in IT. Doc. No. 804, 61st Cong., 2d sess. 




WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 59 


nnd 90 cents for soft coal, while the rate to points in the Minnesota Valley is 
the Twin City Rate plus the local rate. It will he generally conceded that 
canal transportation would not only affect a considerable saving in freight 
charges from Duluth to down-river points but would also effect a considerable 
saving in rail rates on coal from Illinois because of competition. 

Assuming that 50 per cent, or 5,000,000 tons, of the total coal consumption 
would be affected by canal transportation or canal competition to the extent of 
40 cents per ton, the saving in freight charges on this commodity alone would 
amount to $2,000,000 annually. 

It is difficult to obtain any accurate data as to the quantity of manufactured 
and pig iron shipped into this territory. A careful estimate places the amount 
at 1,500,000 tons annually. A saving of 40 cents per ton on freight charges 
would amount to $600,000 per year on iron shipments. 

Rut the benefits of a canal, in so far as it affects the shipment of iron prod¬ 
ucts, is of much greater future importance than present shipments would indi¬ 
cate. When the large steel plant now in course of construction at Duluth is 
completed, the head of the lakes will become one of the great distributing points 
for iron-ore products. More than 1,400,000,000 measured tons of iron ore were 
reported for taxation in Minnesota in 1912, and there are still thousands of 
acres of the ore belt that have not yet been explored, so that it is safe to say 
that the ore deposits of the State will be ample to meet the needs of this im¬ 
mense steel plant for more than 100 years to come. This means that for the 
next century millions of tons of iron-ore products will be shipped annually 
from Duluth to points in the Mississippi Valley and tributary territory. 

The proposed barge canal would permit of the shipment of pig and manufac¬ 
tured iron to points on the Mississippi at less than half the present cost of 
shipping by rail and would greatly stimulate the industrial development of 
every manufacturing city in the Mississippi Valley. 

In addition to coal and iron there are many other commodities that could be 
shipped by canal to points on the Mississippi for consumption at such points or 
for distribution to interior points at a considerable saving in transportation 
charges. The shipments into the canal districts of salt, cement, lime, sugar, and 
other articles of heavy merchandise that could be profitably shipped by water 
aggregate fully 1,500,000 tons annually. A saving of 00 cents per ton on these 
commodities would mean an annual reduction in freight charges of $900,000. 

While the water power that could be developed by the building of the neces¬ 
sary locks and dams in the construction of the canal, by way of the Amnicon- 
Moose River route can only be conjectured; if such power equals the power on 
the Brule route it would approximate 50,000-horsepower. Assuming that this 
amount of power could be utilized in the operation of the canal and for commer¬ 
cial purposes and sold at the very low average of $20 per horsepower, it would 
represent an annual income of $1,000,000. It is not improbable that in the near 
future electricity will not only be the motive power in factories, but will take 
the place of steam on many of the railroad systems of the country. When that 
time comes, the value of the horsepower that could he developed on the proposed 
canal route would be enhanced many fold. The development of the water power 
is one of the important benefits that will accrue from the building of the pro¬ 
posed canal. 

Summarizing the above items, we get the following results as representing a 
net annual saving in freight on these commodities, to which is added the esti¬ 
mated income from water power: 


Coal- 

Iron_ 

Salt, cement, sugar, etc 
Water power- 


$ 2 , 000 , 000 
600, 000 
900, 000 
1, 000, 000 


Total_ 4, 500, 000 

The above estimate does not include many other articles of commerce upon 
which freight rates would be materially reduced because of cheaper water trans¬ 
portation, such as lumber, brick, crushed rock, building stone, flour, grain, and 
other agricultural products, the aggregate of which would amount to hundreds 
of thousands of dollars annually, not alone because of the cheaper cost of water 
transportation but also because canal rates would have a decided influence in 
preventing excessive rail rates. 








GO WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Assuming the cost of the proposed canal to be $10,000,000 and the annual cost 
of maintenance at $350,000, the four items given in the above table would repre¬ 
sent an annual return of 41.5 per cent on the investment. 

Taking up the present necessity of the proposed canal, we are aware of the 
adverse report on the commercial value of the undertaking made by Maj. Sears 
in his report of 1896 and in his supplementary report of 1899. Both reports 
pointed to the fact that three lines of railway almost parallel the proposed 
canal and afforded adequate shipping facilities at that time. These conclusions 
were probably justified by conditions at that time, especially if facility, rather 
than cheapness, is to be the determining factor in transportation problems. 
But conditions have undergone great changes in the Middle West in the past 
15 or 20 years. The development of the upper Mississippi Valley during that 
period has been simply marvelous. Its growth in population, in agriculture, 
in commercial and industrial activities has brought us face to face with trans¬ 
portation problems that did not exist 20 years ago. 

Perhaps no better illustration of the rapid industrial and commercial growth 
of the Middle West could be given than by comparing the vessel tonnage, the 
freight tonnage, and the tonnages of certain raw and manufactured materials 
passing through the Soo Canal in 1894 and in 1910. The following figures are 
compiled from the Monthly Summary of Commerce and Finance, issued by the 
Department of Commerce, December, 1911: 


Growth of Soo Canal traffic , 189^-1910. 



1894 

1910 

Increase. 

Vessel tonnage. 

13,110,366 
13,195,860 
2,797,184 
6,548,976 
60,659 

49,856,123 
62,363,218 
13,513,727 
41,603,634 
444,669 

Per cent. 
280 

Freight tonnage. 

373 

Coal, tons. 

383 

Iron ore, tons. 

535 

Manufactured and pig iron. 

633 

Unclassified freight. 

415' 180 

1,411,549 

240 




These figures afford some index to the marvelous commercial growth of the 
Middle West in recent years. The greater part of the tonnage passing through 
the canal upward reaches the head of Lake Superior and is distributed in 
northwestern Wisconsin, Minnesota, and North Dakota, while the tonnage 
downward originates mainly in Minnesota, two-thirds of the total being iron 
ore. While there will be a substantial decrease in the ore shipments when the 
steel plant is completed at Duluth, there will be a corresponding increase in 
manufactured products to be distributed in the Middle West when this plant 
is in operation. 

The commerical value and utility of a canal connecting the Great Lakes with 
the Mississippi River will be greatly augmented with the opening of the Pan¬ 
ama Canal. It would afford an outlet by water for the commerce of lake ports 
destined for Pacific coast points, thus enabling such ports to better compete 
with Atlantic coast ports—something they will be unable to do if they are 
obliged to reach the Pacific coast by rail. Unless the Middle West utilizes 
the Mississippi and its tributaries in connection with the Panama Canal for 
shipping and receiving Pacific coast freight, it will find itself greatly handi¬ 
capped in the race for commercial supremacy—perhaps for its commercial 
existence. 

The East should not be permitted to dominate the trade that will pass 
through the Panama Canal. But unless the Middle West takes note of what is 
transpiring and prepares to meet the situation it will awake to find that its 
hope of commercial greatness was but a dream. The serious situation of the 
Middle West is greatly intensified by free tolls through the Panama Canal for 
coastwise steamers. It is imperative to utilize our waterways to the fullest 
possible extent to meet the situation that now presents itself. The proposed 
canal will constitute the connecting link between the Great Lakes and the 
Pacific Ocean. It will give us an outlet by water for our inland commerce, 
thus enabling us to successfully compete with the East. It will give us a con¬ 
tinuous waterway from the Atlantic to the Pacific through the heart of the 
continent, thus bringing us into water communication with the entire world. 















WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 61 


As a basis for calculation as to the present volume of commerce between the 
St. Croix and the Mississippi River points and the East via the Duluth-Superior 
Harbor, the so-called lake-and-rail route, we have secured some statistics 
showing the receipts and shipments from the Duluth-Superior Harbor as shown 
in the Annual Report of the Chief of Engineers, United States Army, to the 
Secretary of War for tlie year ending June 30, 1912; also as shown in the 
Monthly Summary of Commerce and Finance of the United States, and also 
from the associations of commerce of various cities. 

Estimates given us by shippers, railroads, and other sources of information 
show the receipts at the Duluth-Superior Harbor for year ending June 30, 1912, 
to be 9.705,340 tons. From reliable information it is shown that approximately 
00 per cent of the receipts at the Dulutli-Superior Harbor* come to St. Paul, 
Minneapolis, and the Minnesota Transfer, making 5,859,207 tons to these 
points. The foregoing figures do not include lake-and-rail business to St. Paul, 
Minneapolis, and other river towns from Lake Michigan ports—Chicago, Mil¬ 
waukee, Manitowoc, Green Bay, etc.—which are very considerable, but for 
which we have no statistics. 

As to shipments from St. Paul, Minneapolis, and the Minnesota Transfer 
to the Duluth-Superior Harbor, it is shown by the report of the Railroad and 
Warehouse Commission of Minnesota, and from other sources, that over 600,000 
tons of Hour and approximately 400,000 tons of other commodities are shipped 
from St. Paul, Minneapolis, and the Minnesota Transfer to the Duluth-Supe¬ 
rior Harbor each year. 

Of the 5,859,207 tons of freight received at St. Paul, Minneapolis, and the 
Minnesota Transfer and 1,000,000 of freight shipped to the Duluth-Superior 
Harbor, it is fair to assume that 50 per cent or 3,429.603 tons would be shipped 
by way of the proposed canal at a saving of about 50 cents per ton, making a 
saving of $1,714,801 annually. 

We have no data, nor is it possible to estimate the enormous amount of 
freight, particularly general merchandise, which through a lowering of the 
freight rat^s would be brought by way of the proposed canal from the eastern 
markets on boats which go East loaded with iron ore and whose owners are 
very desirous of securing ballast for return trips at very low rates, i. e., im¬ 
ported and domestic merchandise which now comes into this market over the 
railroads from the southeast and which in the event of the proposed canal 
would come through the Duluth-Superior Harbor, thence by way of the canal 
to jobbers and manufacturers of the Northwest. 

The proposed canal line from Duluth-Superior Harbor to the Twin Cities on 
the Mississippi River is in fact only an extension of the Erie Canal. Gather¬ 
ing products of the Western States, delivering them at the Duluth-Superior 
Harbor, to be shipped by larger boats to Buffalo and Erie Canal ports. 

Mai. Sears in his report recommends a canal of 7 feet draft, but as the Erie 
Canai is 12 feet deep we would suggest that a canal 10 to 11 feet would be 
more serviceable. Barges could often be loaded from large boats direct, thus 
saving one transfer. There is no doubt but that the lake traffic would receive 
a strong impetus by the building of this canal and the completion of the im¬ 
provements of the Erie Canal. 

FUTURE DEVELOPMENTS. 

The immense resources of the St. Croix and the Mississippi Valleys call to 
mind the great benefit which would be derived by the construction of this 
canal. It is well known that for miles on each side of the St. Croix River the 
soil is particularly adapted to the raising of potatoes, grain, and other farm 
produce, many thousands of carloads of potatoes being shipped to eastern and 
southern markets each season. It is also a well-known fact that during the 
past season the railroads traversing this territory were incapable of handling 
the crop, due to lack of cars and other causes. Also it is well known that the 
price of’potatoes was about 100 per cent higher in St. Louis and other Mis¬ 
sissippi points than at points on the St. Croix River, due to heavy freight 
charges and for storage charges while waiting for cars at shipping points. 
Therefore it w r ould not only be of tremendous advantage to the farmers in 
the territory adjacent to the proposed canal but also to thousands of families 
in the Eastern and Southern States. 

The geological survey of the territory adjacent to the proposed canal shows 
vast deposits of trap rock, which would develop great crushed-rock industries; 
lime rock, which would develop lime kilns; building stone, which at present lays 


62 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


dormant owing to lack of cheap transportation facilities; pottery clay deposits, 
which would develop brick industries; filter sand, which is coining into greater 
use each day, but which is now left as deposited by nature; silicate sand, for 
glass manufacture and other industries, which would be greatly developed 
for the benefit not only of this section but that of the entire Nation. 

In compiling the data relating to the proposed Superior-Mississippi Canal 
the committee has endeavored to secure the most reliable information possible, 
and we have therefore referred to the Annual Report of the Chief of Engineers, 
United States Army, to the Secretary of War for the year ending June 30, 
1912. We quote from pages 953, 954, 955 the following, which is pertinent 
to the question in hand: 

“ It is well known that the railroads strive keenly for the north-and-south 
freight business, make lower rates where there is water competition, cut their 
rates on certain commodities, and make sometimes especially low rates for the 
season of navigation, to be increased during the winter months. This latter 
practice was common several years ago.” 

Also from the same authority we quote: “ It is believed the tonnage of the 
Duluth-Superior Harbor is new exceeded by that of but one port in the United 
States—New York.” 

Also, from the same authority we quote: “ The vessel freight of the Duluth- 
Superior Harbor for 1911 was 57 per cent of the amount which passed through 
the Sault locks the same year.” 

Also, from the same authority: “ Improvements of the Duluth-Superior 
Harbor from 1867 to June 30, 1912, is $6,869,741.02, and the freight received 
and shipped during the same period 365,865,859 short tons and the market 
value of the same $3,855,394,224. From this it appears that the cost of the 
Government improvements has been about one-sixth of 1 per cent of the value 
of the freight transported. 

In conclusion, this committee desires to express its regret that the examina¬ 
tion of the canal route seems to be confined to the Aminicon and Moose Rivers. 
We had hoped that your instructions might have been sufficiently broad to 
permit of the examination of different suggested routes in order to determine 
the most feasible one. 

If the Aminicon-Moose River route should be found impractical because of 
insufficient water supply or serious engineering difficulties, we would ask that 
you recommend an examination of other suggested routes in order to determine 
their feasibility. 

Respectfully submitted. 

Citizens’s Canal Association, 

J. G. Armson. 

C. W. Brenner. 

H. H. Harrison. 

Wm. Smithson, Secretary. 

W. C. Masterman. 

The Board of Engineer Officers, 

Duluth, Minn. 


SUPPLEMENTAL REPORT ON WATERWAY FROM LAKE SUPERIOR TO 
THE MISSISSIPPI RIVER. 

United States Engineer Office, 

Duluth , d/mn., July 7, 1915. 

From: Board of Engineer Officers. 

To: The Chief of Engineers, United States Army. 

Subject: Supplemental report on waterway from Lake Superior to 

Mississippi River. 

1. Complying with first indorsement, dated Office Chief of En¬ 
gineers, Washington, September 18, 1914, on letter from the Board 
or Engineers for Rivers and Harbors, the board of officers of the 
Corps of Engineers constituted by Special Orders No. 19, War De¬ 
partment, Office of the Chief of Engineers, AVashington, August 14, 
1912, submits the following supplemental report. 

2. The appellant before the Board of Engineers for Rivers and 
Harbors appears to be made up of a commission from the State of 
Minnesota and another from the State of AA r isconsin. In all cases in 
this report they will be referred to as the commissions. Since the 
commissions’ appeal is made in two documents, 1 one called “ General 
data” and the other “ Supplemental data,” the former will be desig¬ 
nated “ G. D.” and the latter as “ S. 1).” after the heading or the 
number of the paragraph wherever reference is made to the matter 
put forth by the commissions. 

3. As considerable differences appear to exist between the board’s 
statements and the views of the commissions, it is believed to be de¬ 
sirable to review in general the two documents submitted by them. 

4. Length of canal (par. 0, G. D .)—The “General data on Lake 
Superior-Mississippi River Canal,” published on page 2 of House 
Document No. 920, Sixty-third Congress, second session, was not a 
part of the board's report, but information handed to the commis¬ 
sions’ representative, when the latter was given an opportunity to 
review the report. The distance from the Duluth Canal to the mouth 
of St. Croix is more accurately 221 miles instead of 222, as stated therein. 
The commissions' claim that the distance should be calculated from 
the junction of the canal with Allouez Bay is a matter of opinion. 
This junction is nearly 2 miles from the nearest water in the harbor 
deep enough to float a lake vessel and the same distance from the 
nearest commercial dock of any kind. The board considered the 
haul from Minneapolis to Duluth-Superior as 260 miles, whereas 
the commissions believe it should be 250. The following facts 
pertain: 

The distance from Minneapolis to deep water in Duluth-Superior 
Harbor is nearly 252 miles. 

The distance to Superior Harbor Basin is nearly 253 miles. 

The distance to the Duluth Harbor Basin is about 260 miles. 

The average distance to all coal docks in Duluth-Superior Harbor 
is about 259 miles. 

The average distance to all grain elevators in Duluth-Superior 
Harbor is about 258 miles. 

The average distance to all general merchandise docks in Duluth- 
Superior Harbor is 259 miles. 


1 See page 97 for “ General data,” and page 181 for “ Supplemental data.” 

63 




64 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

The distance to the Zenith Furnace is 262 miles. 

The distance to the United States Steel Corporation’s plant is 270 
miles. 

It therefore appears that 260 miles is approximately correct. 

5. Report of local board founded upon artificial and preventable 
obstacles (paragraph 9 , G. D.). —The board’s report is founded on 
conditions as they exist, and not on conditions which may exist after 
legislation has been had to compel the railroads to do certain things 
and to prevent their doing others. What conditions may exist four, 
six, or eight years hence the board can not predict. Its conclusion, 
as to whether a canal is or is not now commercially feasible, must 
be based on present conditions. Certain freight rates now exist. 
If they are tending to increase, that is only in unison with all other 
expenses, and their increase must be followed by that of water rates 
unless other conditions in some way help the water rates. 

6. Decadence of inland waterways and canals (paragraph 11a , 
G. D.). —The general decadence of traffic on our inland waters is 
well known. It does not follow, however, that the only inference 
possible is that traffic thereon is no longer profitable or practicable; 
that all inland waterways are unworthy of improvement; or that 
railway transportation is cheaper. The failure to use inland waters 
as transportation routes is a fact—even, in many cases, where such 
transportation is cheaper. This may change in the near future, but 
it has not changed yet. The commissions’ Exhibit III (G. D.) is 
quoted at length to show the great saving by the use of the Monon- 
gahela River by Jones & Laughlin, a coke firm which uses 2,000,000 
tons of coal per year, and transports it from mine to plant at 10 
cents per ton, at a saving of 25 cents per ton over railroad rates. 
This transportation is from the company’s own mines, by its own 
steamers and boats, to its own plant. Two quotations, very perti¬ 
nent to the general use of inland waterways, appear in paragraph 
6 of the same exhibit: “As a matter of fact but little attempt is made 
by the railroads in the Monongahela Valley above Pittsburgh to 
compete in the local markets with the boats for home trade.” Water 
transportation is so cheap that the railroads can not meet the rates. 
This appears an ideal case where water transportation has won out 
and defeated the railroads; and yet: “As for local rail rates they 
are very high as compared with river rates in the Monongahela 
Valley, nevertheless in this city (Pittsburgh), owing very largely to 
its topography, much the greater part of the local demand is met by 
the railroads.” The two cases cited by the commissions, where large 
firms are using their own fleet for transporting their own coal, ap¬ 
ply to users of 2,000,000 (paragraph 25e, G. D.) and 1,000,000 tons 
(paragraph 30, G. D.), respectively. At the same time and in the 
same territory the small manufacturer and the household consumer 
is paying the rail rate. It is not considered probable that any con¬ 
sumer will be found in St. Paul or Minneapolis who will own his 
own transportation lines from Duluth, and who will deliver, into 
his own plant, an immense quantity of coal such as is used by Jones 
& Laughlin or the Crucible Steel Co. The board is not attempting 
to disparage the use of waterways by such companies, and willingly 
accepts the fact that their use of this cheaper transportation is a 
public benefit, justifying large expenditures on the waterways and 
reducing the price of the product to the people. These conditions, 
however, do not appear applicable to the Twin Cities. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 65 

7. As to the difference in the figures on the freight moved on the 
upper Mississippi River in 1889 and in 1906, the board took these 
figures from an official Government report, and therefore did not 
consider it necessary to check them. It appears that there was a 
mistake in the figures as printed in that report. 

8. Handling and terminal charges and railway hostility to water¬ 
ways and canals {par. lib , G. D.) —The first subject treated of is the 
terminal charge on coal. The commissions state that the board 
charged: 

(a) 25 cents for transferring coal from vessel to canal barge. 

( b ) 25 cents for unloading coal from canal barges. 

(c) 25 cents for deterioration in handlibg (degradation). 

(<f) 25 cents for delivery in car-load lots. 

Regarding statement (a) the criticism is undeserved as the board 
made no such charge. In arriving at the other three charges, the 
board took the statements of people handling large quantities of coal 
in Duluth-Superior. These people should be in a position to give 
more reliable data than those in any other section of the country 
where the conditions are entirely different. These coal merchants 
buy an article in Pennsylvania which their customers demand. 
When it gets to Duluth it is adulterated with a substance which their 
customers will not accept. It must be purified and the adulterating 
material must be sold at about cost. Duluth dealers have gone ex¬ 
tensively into the making of briquettes from the screenings, and in 
selling the manufactured briquettes—often at a lower price than the 
price of screened coal. They are in the section which demands 
screened coal. The United States engineer officer, at Pittsburgh, 
states (Exhibit III, par. 5, G. D.) that the run of the mine, with 
much slack, is now being preferred in that section “ on account of its 
low price.” Others state that the use of automatic stokers makes 
crushing necessary and, therefore, the slack is no loss. But the 
Northwest is not the section of automatic stokers and, until con¬ 
ditions there change the demand will continue to be for screened 
lump coal. Some few plants now buy and use the screenings because 
they are cheaper. The screenings, taken out at the head of the Lakes, 
costs the dealer just as much as lump coal—the condition in which 
it left the mine—and if he has to screen them out and sell them at 
a lower cost there is a loss in value. The Ohio Coal Commission 
(par. 39, G. D.) goes into a discussion of the fact that proper mining 
can reduce the amount of slack, but we must take the coal as it comes. 
The United States Bureau of Mines (par. 39, G. D.) goes into the 
number of handlings of the coal, and states that if each handling 
caused a loss of 25 cents there would be no value left. The bureau 
overestimates the handlings between the mines and Duluth-Superior 
by two, at the lake-loading port. Modern machinery takes the rail¬ 
road car and upsets it into the vessel. 

9. Handling of coal. —The coal is mined and screened through a 
J-inch screen. It is then dumped into the car, transported to Lake 
Erie, the car upset into a lake vessel, transported to Duluth, clam- 
shelled out of the vessel, dumped on the dock, clamshelled from the 
pile, and dumped into the screen. It gets, therefore, from screen to 
screen: 

One dumping into the car, one dumping into the vessel, one clam¬ 
shelling out of the vessel, one dumping onto the dock, one clamshell¬ 
ing from the loose pile, and one dumping into the screen. 

H. Doc. 1008, 64-1-5 


G6 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


A total of four dumpings and two clamshellings. 

The additional handling that it would get by the canal would be: 

One dumping from the pockets into the canal barge, one clamshell¬ 
ing out of the canal barge, and one dumping onto the dock. 

Total—Two dumpings and one clamshelling. 

It therefore must get 50 per cent more handling, if it should go by 
canal. It would not be proper to give equal degradation effect to 
each one of these handlings. There appears to be little doubt that 
the great degradation results from clamshelling; that degradation 
from clamshelling in a confined space would be greater than from 
a loose pile; and that clamshelling near the bottom of a vessel, ac¬ 
companied by shoveling, would produce the greatest degradation. 
This can be seen from a description of unloading coal, given by a 
St. Paul coal dealer operating large docks at Duluth-Superior. The 
description has so much bearing on the cost of unloading coal from 
shallow barges at St. Paul, as compared with unloading from a lake 
vessel, as well as on the resulting degradation, that it is given in full. 
He said, “Assume a vessel having 25 feet of coal in it—we can unload 
the first 20 feet by clamshell without much work on the part of the 
men in the hold. Then it becomes what we call a cleaning-up process, 
and labor in the hold has to keep the coal shoveled into heaps deep 
enough for the clam to work into. During that time we pay the 
laborers in the hold 60 cents per hour, as against 25 cents in the earlier 
operations, and the time necessary to unload a ton of coal in cleaning 
up is double that in the earlier process. It is also necessary in the 
cleaning-up operation to increase the number of laborers in the ves¬ 
sel.” By calculation, even neglecting the increased number of labor¬ 
ers required, it may be shown that the cost of labor for unloading 
10,000 tons of coal 5 feet deep (5 feet of coal equals 4 feet draft and 
1 foot for the boat gives 5 feet draft for a 6-foot canal) will be 
increased 173 per cent for labor in the boat and 67 per cent for all 
wharf labor employed in the unloading operation above what it 
would be for unloading the same amount of coal standing 25 feet 
deep in the hold of a lake vessel. The fuel cost of operation must be 
increased some, on account of the increased time, and the degradation 
must be greatly increased where the entire cargo (instead of 20 per 
cent of it) must be shoveled to the clam, and the clam is always work¬ 
ing down near to an iron deck. The board is asked to admit that 
the cost of unloading 10,000 tons of coal from a lake vessel, where it 
is 25 feet deep and occupies a space the width of two canal barges 
and 600 feet long (say, 40,000 square feet) and at practically a con¬ 
stant stage of water, will be equal to the cost of a “ cleaning-up ” 
process, covering the whole cargo over an area of the same width 
and 3,000 feet long (say, 200,000 square feet) on a variation of water 
level from 8 to 20 feet. The board is also asked to admit the degrada¬ 
tion in coal due to 152 miles’ travel in a car is equal to that caused 1 
by two dumpings and the “ cleaning-up ” operation by clamshell and 
shoveling. It is believed that both these assumptions are erroneous 
and should not be accepted for the reason given above. 

10. The soft-coal business .—In this discussion the board has taken 
conditions existing in 1914, prior to August 1, and therefore as 
unaffected by war and business depression. In former times the coal 
was screened at the mines through a J-inch screen and at the head of 
the Lakes through the same. The consumer now insists on a l}-inch 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 67 

or 2-inch screen at the head of the Lakes and everything that goes 
through it must be sold as screenings. This shows that the trade will 
not accept anything but lump coal, or screenings at a lower price, 
and that their demands in that line are not relaxing. The board in 
its former report took general statements of people handling coal. 
It has since studied the question more thoroughly and is prepared to 
give figures more definitely but in a somewhat different way. The 
best lump coal, screened at the mine through a f-inch screen, costs 
$2.25 per ton aboard a lake vessel on Lake Erie. The freight to 
Duluth-Superior is 30 cents, making it $2.55 aboard vessel at the 
dock. There is arbitrarily charged for the dock 35 cents for every 
ton of coal. This includes unloading to the dock, the cost of storage, 
clamshelling it to the screen, screening, and loading into the car; or, 
in other words, the total dock cost without any profit. Adding the 
35 cents, the cost of every ton of coal shipped from docks is $2.90. 
The price of lump coal f. o. b. Duluth-Superior is (barring some 
temporary irregularity due to war and other business conditions) 
$3.55, and of screenings is $2.55. Since the price of screenings is 
exactly equal to the cost of coal alongside the dock, the lump coal has 
to pay all the dock charges, cost of selling, and profit to the dealer. 
The screen passes 40 per cent of the coal and generally more, but 
prices are figured on that basis. Taking 10 tons of coal loaded on 
cars at Duluth-Superior, it has cost the dealer $29 and he gets out of 


it— 

6 tons of lump coal, at $3.55-$21. 30 

4 tons of screenings, at $2.55- 10. 20 


31. 50 

This leaves the dealer 25 cents per ton to cover the cost of sale (offices 
in Duluth, St. Paul, and Minneapolis and agents looking up busi¬ 
ness) and his profits. The actual cost of selling coal is about 15 
cents per ton, leaving apparently 10 cents profit on each ton of coal 
handled. The board is reliably informed that the profit will scarcely 
average 4 cents—the other 6 cents is lost at the dock, partially due to 
the fact that 35 cents does not cover dock costs and partially due to 
breakage above 40 per cent. The actual dock cost on every ton of 
coal— anc [ the dock gets only the interest on the investment, deprecia¬ 
tion, upkeep and repairs, taxes, insurance, and the actual cost of 
handling the coal—is nearer 40 cents than 35 cents, as allowed by all 
coal dealers. One dealer states the cost to be 40 cents. The docks 
are the plants, and the dealers do not expect a profit from the plant— 
only enough to pay its expenses, including interest on the invest¬ 
ment and to guarantee its existence—any more than a manufacturer 
would expect a profit on the cost of his mill. 

11. Cost of handling coal .—In its original report the board 
spoke sometimes of this operating as “unloading,” but meant it to 
cover all of the extra handling and not the simple operation of un¬ 
loading. This is apparent in paragraph 56, where it is first men¬ 
tioned. The commissions state there is ample room for coal docks 
in each of the two cities (St. Paul and Minneapolis) adjacent to the 
river. This is at variance with the board’s statement, but it is only 
a matter of opinion, and would be difficult to demonstrate, either one 
way or the other. In handling coal in the Twin Cities the board 
assumed that it would be taken up as a business proposition, believing 





68 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

that the most satisfactory work could be done with an adequate 
plant. It outlined and estimated the cost of a coal yard with a 
capacity of 500,000 tons, based on the Mead-Morrison plant (Exhibit 
IX, par. 2b, G. D.) ; took Mead-Morrison’s figures as far as 
they went, and then used the best it could get as to cost of land, of 
building the yard, and of the buildings; took what it considered 
proper figures for all other items of cost; allowed a reasonable figure 
for contingencies; and arrived at a cost between 24 and 28 cents per 
ton. The figures were taken to a coal dealer w T ho had been in the 
business of building and operating coal docks at Duluth-Superior, 
Ashland, and Gladstone nearly all his life, “ from the time when we 
unloaded by derrick operated by a horse.” He said the cost per ton 
was too low, and the cost of yard, outfit, building, etc., was too 
high. It was formerly estimated that a plant could be installed at a 
cost of $1 per ton of its capacity, but now it requires about $1.50. 
The board’s estimate on a 500,000-ton plant was $1,000,000. He 
thought it could be put up for $800,000, even with the land values 
pertaining to St. Paul and Minneapolis, if the land could be found. 
Looking over the board’s estimate, he noted interest 5 per cent and 
depreciation 5 per cent. “ That is what we allow, except we reckon 
interest at 6 per cent and depreciation 5 per cent—at the end of 20 
years a coal-dock outfit will be nothing but scrap.” He then stated 
that upkeep and repairs cost them 3 cents per ton on every ton of 
coal handled, beyond the 5 per cent allowed for depreciation; that 
the overhead pay roll—superintendent, foreman, weighmaster, and 
clerks—was a tax of 5 cents per ton; and that the loss by fire was 
quite a factor. The board’s assumed figures for- overhead pay roll 
and repairs were too low. Actual experience show T s it to be 8 cents 
on every ton handled. He was then asked as to the cost of handling 
by smaller plant, and stated that the cost of handling was practically 
independent of the size of the plant. The size is determined by the 
volume of business. Asked as to the necessity of foremen, he stated 
some of their docks employed 125 men, and each operation must 
have a foreman. Asked as to insurance on coal, he stated that insur¬ 
ance was so high on soft coal as to make it almost prohibitive. On 
hard coal he insures to a small per cent of the full value. Another 
company stated that, in handling 1,000,000 tons in 1913, they had a 
fire (they also stated that several companies at Duluth-Superior had 
fires that year) which reduced 30,000 tons from a value of $3.15 (GO 
per cent at $3.55 and 40 per cent at $2.55) to $2 per ton. This meant 
a loss of $34,500 on 1,000,000 tons handled, or a tax of 3.5 cents on 
each ton. The above figures are given to show what it costs to 
handle coal and to offset those given by machinery enthusiasts, who 
create the impression, when they state the cost of fuel and labor at 
3 cents, 4 cents, or 5 cents, that they have included the entire cost of 
handling coal. 

12. Cost of extra handling of coal carried by canal .—The com¬ 
missions object to the board’s method of transferring the extra cost 
of handling to St. Paul-Minneapolis and prefer that it be figured 
at Duluth-Superior. This can be readily done, but it must be ex¬ 
tended to cover the extra cost of unloading from canal barges, at 
the southern terminal, over that of unloading from lake vessel. 
The commissions have obtained from various machine-building com¬ 
panies the cost of a proper outfit for transferring coal from lake 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 69 

vessel to canal barge and the cost of operation (Exhibits 6 to IX, 
G. D.). There is only one company which gives anything like full 
figures on costs and proposes an adequate plant for unloading lake 
vessels. This is the Mead-Morrison Manufacturing Co. (Exhibit 
IX, G. D.-). In paragraph 1 (b) they estimate the cost of a com¬ 
plete plant at $1,000,000 exclusive of ground value. They estimate 
the machinery at $100,000. This outfit is a little more elaborate 
than is needed, since weighing and screening is not necessary, but 
that part of the plant is not very expensive and the plant without 
that may be considered to cost $900,000. It is designed to handle 
1,000,000 tons in six months and to store 500,000 tons. Such a plant 
would go into the coal business at Duluth-Superior, or St. Paul 
and Minneapolis, in a creditable way. It would supply two coal 
yards (one in each of the Twin Cities) with 500,000 tons per year. 
It would have a storage capacity of 500,000 tons which would cover 
20 acres 23 feet deep piled vertically. In pockets, coal could 
scarcely be piled so deep over the entire area, but it will be assumed 
that the plant could be put on 20 acres. Land for such a plant on 
the Duluth-Superior water front would not cost less than $5,000 
per acre, making a total cost of $1,000,000 for the plant. It will 
be seen that this is a low figure. The coal dealer’s general figure, of 
$1.50 per ton capacity, would make such a plant cost $1,500,000 for 
an open dock, and pocket storage would make it more expensive. 
If any of the storage were not made in the pockets, but on open 
dock, that portion would be subjected to an extra handling by 
clamshell and an extra dumping, increasing the cost, and increasing 
the degradation to 75 per cent of what it now is. On the basis, 
however, of a $1,000,000 plant, the cost will be figured. At 5 per 
cent, the interest on the investment will be $50,000; 5 per cent de¬ 
preciation on a $400,000 plant would amount to $20,000; 3 per cent 
depreciation (allowing they will last 33 years) on storage bins, build¬ 
ing, wharf foundations, etc., ($500,000) will amount to $15,000; the 
cost of fuel and labor (Mead-Morrison estimate, par. 1 (c), Exhibit 
IX, G. D.) is 3 cents per ton, or $30,000 on 1,000,000 tons; making a 
total of $115,000, or 11.5 cents per ton for the 1,000,000 tons handled. 

This plant must be placed on a par with the large coal docks at 
Duluth-Superior, where experience shows that overhead pay roll on 
every ton of coal is 5 cents, and the cost of upkeep (exclusive of 
depreciation at 5 per cent) is 3 cents on every ton handled. Such a 
plant would have slightly less overhead pay roll than the ordinary 
coal dock, because of no weighing or screening, but the repairs would 
be heavier. It does not, therefore, appear that the coal could get 
away from Duluth by canal with a tax less than about 19 cents due 
to the extra handling. To complete the extra handling cost, there 
must be added the extra cost of unloading from canal barge at St. 
Paul-Minneapolis over unloading the same coal from lake vessel. It 
has been shown in paragraph 9 that the minimum extra cost of labor 
in the boat is 173 per cent and on the dock is 67 per cent and the fuel 
cost would be increased some. Considering the fact that the greater 
part of the labor is in shoveling the coal in the barge, it would be 
reasonable to assume a general increase of unloading cost (fuel and 
labor) of 100 per cent. Mead-Morrison estimate the fuel and labor 
cost of unloading a lake vessel at 3 cents per ton. Then the extra 
cost from canal barges would be 3 cents. This added to the 19 cents 


70 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

at Duluth would amount to 22 cents. It must be noted that the above 
cost included no taxes, no insurance on plant, and nothing, except 1 
per cent on the investment, which would not be necessary in a public 
terminal. Also no account is taken of unloading in a river of varying 
level. One per cent on $1,000,000 would mean a saving of 1 cent per 
ton on the 1,000,000 tons handled. It therefore appears that a corpo¬ 
ration owning such a dock and transferring the coal, would be put 
to an expense of 22 cents per ton, for all the extra handling by canal, 
plus taxes and plus insurance on the plant; and that a public termi¬ 
nal would be put to an expense of 21 cents plus insurance or plus a 
possible loss due to lack of insurance. Such a plant, where coal is 
stored in bins, would be much more subject to loss if a fire occurred 
in the coal than would an open dock (this refers to loss of plant and 
not to loss of coal) and therefore the insurance rates should be higher. 
A most careful calculation has been made of the cost of insurance (on 
plant alone) and of taxes on the coal dock property in Duluth-Su¬ 
perior Harbor for 1913. The insurance premiums (generally on 
three-fourths of the value) paid by all the companies amounted to 
$54,783 on a total estimated value of $10,403,674. The taxes on the 
same amounted to $167,858. It may therefore be assumed that, on a 
$900,000 plant the insurance would be about $4,700; and on a $1,000,- 
000 plant and ground value the taxes would be $16,000. These, on 
the basis of 1,000,000 tons, would add 2 cents to the cost if handled by 
private capital, making the cost 24 cents; and one-half a cent if 
handled by public terminal without taxes, making the cost 21.5 cents. 

All these figures are based on the plant’s handling its estimated 
capacity, or 1,000,000 tons. If it fell down to 800,000 tons (a reason¬ 
able contingency), the cost for a public terminal would run up to 
about 27 cents, and for a private corporation to about 30 cents. The 
cost of fuel for hoisting, and a part of the labor, would be saved on 
the unused capacity of 200,000 tons. It therefore appears that the 
board’s estimate of 25 cents for the extra handling cost, if in error, 
lacked in conservatism. From the time the coal has paid the cost or 
handling at Duluth-Superior and the extra cost of unloading from 
canal barges at St. Paul-Minneapolis, over what it now costs at 
Duluth-Superior to unload from lake vessels, it may be compared on 
the basis of being alongside the dock at Duluth-Superior with dock 
charges and rail rate ahead of it, or alongside the dock at St. Paul- 
Minneapolis, with the dock charges in those cities ahead of it, with 
the canal rate unpaid, but extra unloading cost paid. It undoubtedly 
has been put to an expense of 25 cents, if not more, for the extra 
handling due to the use of the canal. It is presumed that it will be 
handled at St. Paul-Minneapolis in the same way as at Duluth— 
screened and weighed for shipment or delivery—and that it will 
necessarily cost as much as at Duluth. Therefore, since both are 
alongside their docks, further charges for dock service are equal. 
Such quality is recognized by the commissions (transportation by 
Canal Involves, etc., S.D.) except that they claim equal unloading 
cost, whether from lake vessel or canal barge. 

13. Exception is taken by the commissions to the board’s original 
estimate of 25 cents for the extra handling of coal. After quoting 
(paragraph 36h, G.D.) the figures of Mead-Morrison and stating 
that they vary from 7 to 12 cents per ton, and presumably noting that 
they included interest on the cost of the plant at only 4 per cent and 


Waterway from lake superior to Mississippi river. 71 

did not consider ground values and taxes or depreciation and interest 
on the cost of the wharf, the commission figures (see “ Canal is Com¬ 
mercially Feasible, etc.—Coal,” S.D.) that the full cost of the trans¬ 
fer of coal in Duluth-Superior will be only 5 cents per ton. The 
Mead-Morrison statement (Exhibit IX, paragraph lc, G.D.) gives 
3 cents per ton as the cost of fuel and labor only. The commissions 
allow 5 cents for the complete transfer. That leaves 2 cents to cover 
interest on cost of plant, interest on cost of wharf, depreciation of 
plant, depreciation of wharf, repairs to plant, repairs to wharf, taxes, 
and insurance. The board feels that such figures are unreasonable. 

14. Degradation .—In its former report the board spoke of the 
u deterioration ” of coal in handling. It has learned from the coal 
dealers that “ degradation” is the proper term. In making its esti¬ 
mate of 25 cepts per ton for degradation due to the extra handling, 
to which canal coal would be subjected, the board took the statements 
of coal dealers and did not attempt to get at the figures. It has since 
studied the subject and can arrive at some conclusions, although the 
whole matter is somewhat indefinite. It has been shown (paragraph 
9 above) that, in the minimum of extra handling resulting from the 
use of the canal, there are half as many handlings, and half as many 
of each kind of handling, as in the operation of transporting the coal 
from mine screen to Dulutli-Superior screen; it has been shown 
(paragraph 12 above) that any coal, not stored in pockets at Duluth- 
Superior, but stored in the open and transferred to the pockets, will 
get three-quarters as much handling by canal as it gets now from 
screen to screen; it has been shown (paragraph 9 above) that the 
degradation in unloading from shallow barge must be greater than in 
any handling it now gets; and it has been shown that the degrada¬ 
tion from screen to screen in the present handling is 3 tons or more 
in every 10. A reduction of 3 tons out of 10 to screenings means a 
loss of 30 cents per ton on every ton handled. Since the extra han¬ 
dling by canal varies from 50 to 75 per cent of that from screen to 
screen, and since the unloading from canal barge will be more de¬ 
structive than any handling it now gets, the board believes that its 
estimate of 25 cents is not unreasonable. 

15. Delivery in /St. Paul-Minneapolis .—Exception has been taken 
to the board’s figure of 25 cents per ton for delivery in St. Paul- 
Minneapolis from the landing dock to local coal yards, or to carload 
consumers. This was taken from House Document 304, Sixty-first 
Congress, second session, page 23, where it is stated as a minimum of 
the cost in Superior. In Duluth and Superior the coal dock people 
also own the local yards in the same towns and are therefore in a 
position to figure the actual cost and the best method of handling the 
retail wagonload business. They state the minimum cost of delivery 
by car to local yards and carload consumers to be 25 cents per ton. 
The board can give only the rail rates in St. Paul-Minneapolis and 
leave incidentals out of it. The commissions figure 5 cents per ton 
on 50 per cent of the coal, or an average of 2-| cents per ton. They 
evidently figure that the wagon delivery to all part of the two cities 
can be made from the landing yard in each city. This it at variance 
with the opinion of all coal dealers consulted, except one who thought 
he could do it in St. Paul by the use of motor trucks instead of teams, 
but he admitted that it would require a tremendous coal yard so as 
not to mix up rail service with truck service. Land for a coal yard 


72 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


of those proportions could not, in the opinion of the board, be found 
adjacent to the river in either St. Paul or Minneapolis. The coal 
dealer admitted this. Coal in St. Paul is now delivered by horse- 
drawn wagons. There are a few motor trucks, but the teamsters’ 
unions demand that they shall not be used except when the work is 
too great to be handled by horses. To deliver in a certain area the 
union price is 60 cents per ton, no matter how short the haul; outside 
that area it is $1.20 per ton; and each hour’s delay in loading a 
wagon costs the coal merchant 60 cents. Due to these conditions the 
coal companies have local yards in various parts of the cities. Du¬ 
luth, which has an area of about 60 square miles and a population 
of about 90,000, has eight local coal yards; Superior, which has an 
area of 36.5 square miles and a population of about 45,000, has two 
local coal yards; and these two cities have large numbers of coal 
docks from which retail deliveries could be made if it were practi¬ 
cable. In neither city is the built-up territory anything like the area 
given. The Duluth coal merchants claim that in their city they could 
not handle the local coal business from their docks. The confusion 
and delay would make it more expensive than to ship the coal by rail 
to local yards and team it therefrom to the small consumer. 

Minneapolis has an area of 53 square miles and a population of 
351,000. St. Paul has an area of 54.5 square miles and a population 
of 270,000. It is not considered necessary to give further figures to 
show that practically all coal coming to the river landing will be 
taken away by rail, either to carload consumer or local yard, or for 
outside shipment. There can also be little doubt of the figure of 
25 cents for the minimum cost of delivery in Superior given by a 
man who knew the local delivery business. But the board is now 
prepared to give the actual rail-rate cost of such delivery over the 
cost of the same delivery in case the coal comes to St. Paul-Minne- 
apolis from Duluth-Superior by rail. On coal shipments by rail 
from Duluth-Superior to St. Paul-Minneapolis there are no switch¬ 
ing charges at either end. Therefore, the carload consumer, or the 
local coal yard, pays only the freight rate of 96 cents per ton on soft 
coal and $1.20 per ton on hard coal for delivery in St. Paul or 
Minneapolis over the cost on leaving the dock at Duluth or Superior. 
The delivery of coal from a river terminal in St. Paul or Minneapolis 
to the carload consumer, or the local yard, will entail transportation 
or switching charges. If the river coal yard be on the track of a 
certain road and the destination be on the track of the same road, the 
rate—from industry to industry—is 1 cent per 100 pounds, or 20 
cents per ton. If the destination is on a different track, the originat¬ 
ing line gets $1.50 per car for putting it on the track of the delivering 
road and the latter road gets $5 per car for delivering, making a total 
cost of $6.50 per car. A large coal dealer states that their shipments 
average 30 tons to the car. At that figure the $6.50 per car would 
amount to 22 cents per ton. Thus the actual rail rate in St. Paul and 
Minneapolis on all coal delivered to local yards or to carload con¬ 
sumers would be 20 cents or 22 cents per ton. This includes all coal 
except that shipped out of town by rail. The board selected at ran¬ 
dom three towns southwest of St. Paul-Minneapolis: New Ulm, 
Mankato, and Glencoe. The rates on coal are as follows: 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 73 



Soft. 

Hard. 

St. Paul-Minneapolis to New Ulm. 

$1.32 

.96 

$1.65 

1.20 

Duluth-Superior to St. Paul-Minneapolis. 

Sum. 

2.28 

1.80 

2.85 

2.05 

Duluth-Superior to New Ulm. 

Difference.1. 

.48 

.80 

St. Paul-Minneapolis to Mankato. 

.75 

.95 

Adding, $0.96 and $1.20. 

1.71 

1.50 

2.15 
2.05 

Duluth-Superior to Mankato. 

Difference. 

.21 

.10 

St. Paul-Minneapolis to Glencoe. 

.65 

.83 

Adding $0.96 and $1.20. 

1.61 

1.55 

2.03 

1.80 

Duluth-Superior to Glencoe. 

Difference. 

.06 

.23 



From this it will be seen that, under present rates, soft coal can be 
shipped from the Head of the Lakes to these three towns (selected 
without knowing anything of the rates) at an average of 25 cents 
per ton cheaper, and hard coal 38 cents cheaper, than it could if the 
coal were shipped to St. Paul and there reshipped at a local rate. 
By reference to Mr. Hall’s figures in Appendix D (board’s original 
report) it will be seen that as we go farther west the rates from 
Duluth approach those from St. Paul. To Aberdeen, S. Dak., the 
rate on coal from Duluth is the same as from St. Paul. Again, under 
certain conditions there will be switching charges in St. Paul to be 
added to the local rate. A railroad man states that the “ distance 
tariff law ” (paragraph 36, G. D.) does not affect these rates. There¬ 
fore, in regard to the charge of 25 cents per ton for delivery -on all 
coal passing through the river bank yards, the following facts 
appear: 

(a) The actual rail rate in St. Paul will be 20 cents to 22 cents per 
ton, and there will probably be some incidental charge; 

(b) Coal going out short distances from St. Paul (to Glencoe, 
Mankato, and New Ulm) will be subject to an average differential of 
25 cents on soft coal and 38 cents on hard coal; 

(c) Coal going as far west as Aberdeen, S. Dak., will be subject 
to a differential equal to the entire rate from Duluth to St. Paul; and 

( d) All coal moving by canal to St. Paul will leave the river bank 
yard by rail. 

It appears that the board’s acceptance of the stated figure (25 
cents) for Superior was not unreasonable. 

16. Transfer to secondary yard .—The final cost of 10 cents, which 
the board put on coal for delivery of a part of it from the river bank 
yard to another general yard, depends on the availability of space 
near the river for the storage necessary for St. Paul and Minneapolis 
at the close of the navigation season. The board expressed the 
opinion that such storage could not be had near the river, and the 
commissions say it can. If it can the charge of 10 cents made by 
the board (in par. 89 a of its original report) will not be necessary. 

17. Summation .—Summing up the criticism of the commissions at 
the head of paragraph 8 (above), these answers may be made: 

{a) The board made.no extra charge for transfer at Duluth- 
Superior. 































74 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


(£>) The board’s charge of 25 cents for the cost of the extra han¬ 
dling is not excessive; it will undoubtedly be more; and the com¬ 
mission’s estimate of 5 cents is entirely too small. 

( c ) The board’s charge of 25 cents for the degradation is no more 
than a fair precaution would warrant; it must be more than 15 cents; 
it may be 30 cents or more; and the commissions’ claim that there will 
be no degradation can not be justified. 

(d) The board’s charge of 25 cents for delivery in St. Paul is rea¬ 
sonable; the actual switching or rail rate is 20 cents or 22 cents, and 
it costs the coal docks at the Head of the Lakes a minimum of 25 
cents; and the commissions’ figure of 2.5 cents is far too low. 

( e ) The board’s charge of 10 cents for transfer to another yard 
will depend on the availability of storage space near the river. 

The board’s total of 85 cents per ton is not unreasonable. If it 
were to reduce any of its figures it would feel that it was taking 
unwarranted chances. The absolute minimum that can be figured is 
60 cents, and it believes that each one of the four items should be 
given an increase above the minimum figures. The commissions’ 
total figure for these four items is 7.5 cents. 

The board still feels justified in its original statement that Duluth 
and Superior are the logical and economical coal yards for St. Paul 
and Minneapolis. It believes that the proposed canal, as a means of 
transportation for coal between the Head of the Lakes and the Missis¬ 
sippi River, would be of no value. At the present time the larger 
proportion of the coal received at Duluth-Superior Harbor is trans¬ 
ported westward and southward by rail after the close of navigation, 
and all of this late fall and winter traffic would be lost to the canal. 

18. Elevator charges on grain .—In the same paragraph (116, G. D.) 
exception is taken to the board’s charges for elevator services in 
Duluth-Superior and in Minneapolis. The only evidence which the 
board can submit is that the standard elevator charges per bushel 
of grain in Minneapolis are stated to be three-fourths of a cent. That 
the same charges in Duluth-Superior are stated to be 1 cent. The 
board has not gone into an estimate of the actual cost to the elevators. 
These charges exist and figure (at Duluth-Superior) on average grain 
36 cents per ton. If the board should go into figuring the cost, it 
does not believe that it would find the actual cost, considering labor, 
fuel (or power), overhead pay roll, interest on investment, insur¬ 
ance, depreciation, repairs, and ground rent or taxes, would be 5 
cents, and that 31 cents would be clear profit. 

19. A general view .—In the year 1912 there were received at 
Duluth-Superior, 8,585,039 tons of coal. The present value of the 
investment in coal docks at Duluth-Superior is $10,403,674. This 
“present value” is below the original cost, except in the case of an 
absolutely new dock, since the value of an equipment depreciates in 
20 years from its original cost to little or nothing. Depreciation at 
5 per cent and repairs at 3 per cent should be reckoned on first cost 
of equipment. Estimated, however, on present value (and there¬ 
fore at a minimum which can never be reached), 5 per cent interest 
on present total value, 5 per cent depreciation, and 3 per cent repairs 
on present equipment value, and the insurance and taxes which were 
actually paid on plant and property alone (not on coal), these over¬ 
heads amounted to $1,130,624, or a charge on each ton of coal of 13 
cents. In 1913, owing to their handling nearly 11 millions of tons, 
this figure was reduced to 10.2 cents. In Duluth, Avhere the coal 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 75 

handled amounted to about 2,900,000 tons in 1912, and 3,770,000 in 
1913 (but more than the coal shipped to St. Paul-Minneapolis) these 
charges ran up to 19.5 cents in 1912 and 15 cents in 1913. These fig¬ 
ures do not include any operating charges. They do not include 
taxes on the coal, insurance on the coal, interest on the money nec¬ 
essary to carry a stock of coal, labor, overhead pay roll, or the cost 
of power and light to operate the dock. All these items must be 
figured in a business undertaking. The commissions figure the total 
cost of handling coal at Duluth-Superior, from lake vessel to canal 
barge, at 5 cents. An example is given (quotation from Mr. Barnes, 
S. D.) of an elevator in Duluth-Superior which loaded into vessels 
1,250,000 bushels in one day of 10 hours, for which it received 
$12,500. This is a remarkable record and apparently an enormous 
profit. Duluth-Superior handles bulk freight rapidly. Its naviga¬ 
tion season is short and its commerce large. In the grain business 
there is quite a season of inactivity in the midst of the navigation 
season. Grain, therefore, must be handled relatively more rapidly 
than coal or iron ore. The total grain and flax handled at Duluth- 
Superior in 1913 was 115,187,310 bushels, the greatest ever known. 
If the elevator mentioned were to handle the year’s business, at the 
rate cited, it could do it in 921 hours. The 20 rail-to-lake eleva¬ 
tors in Duluth-Superior could, if all were of the same capacity and 
worked at the same rate, handle the whole 115,187,310 bushels in less 
than two days. And yet 20 elevators must exist and pay ex¬ 
penses for 3G5 days. Probably all of these elevators are necessary 
to handle the crop. At the close of the navigation season of 1912 it 
was reported that all of them were full, and thousands of cars could 
not be unloaded, although the elevators had just loaded the immense 
fleet which took down grain on its last trip, to be held in vessel storage 
at Buffalo. 

It is hardly fair to quote, as did the commissions before the Board 
of Engineers for Rivers and Harbors, the enormous elevator profit 
of $1,000 per hour. The following actual record shows what may 
happen in the elevator business, and tends to offset the selected 
record cited by the commissions: On May 4, 1915, the steamer St. 
Clair received 31,000 bushels of wheat; on May 5, 144,095 bushels at 
two different elevators; and on the 8th, 100,011 more, making in all 
276,006 bushels of wheat received from the 4th to the 8th. Here we 
have a case where it required at least’ four days to load a cargo of 
276,000 bushels of grain into a steamer, or at the rate of 2,875 bushels 
per hour. Another case: The steamer M. A. Hanna received 109,093 
bushels of wheat on the 11th of May and 65,000 bushels on the 13th, 
making a total of 174,093 bushels, which required at least 48 hours 
to load, or at the rate of 3,627 bushels per hour. The board has little 
doubt that an analysis of the elevator business at Duluth-Superior 
would show no more than the reasonable profit its investigation has 
shown to result from the coal business. The board believes that the 
commissions have misunderstood Mr. Barnes’s appeal for public ter¬ 
minals (quotation in S. D.). When Duluth began to take rank as a 
business city it found the lake-and-rail rate to St. Paul the same as 
to Duluth. The St. Paul merchant could receive and ship back, half 
way to Duluth, in competition with the Duluth merchant. 

Duluth has always fought to have the lake-and-rail rate terminate 
at Duluth-Superior. It has never succeeded, but has obtained several 
increases of the differential. The last appeal (decided in 1913) 


76 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

brought no increase of rate to St. Paul, but the Interstate Commerce 
Commission gave a reduction from eastern points to Duluth (making 
it the same as Chicago) and the net result was an increased differen¬ 
tial. But the lake-and-rail rate to St. Paul absorbs the transfer and 
storage charges at Duluth. Thus the Duluth merchant has, at 
Duluth, a terminal and storage charge of (estimated by Mr. Barnes) 
33 to 80 cents per ton, from which the St. Paul merchant is relieved. 
The Duluth merchant must reduce this or he can not compete far 
toward St. Paul. It is also a partially unnecessary tax on the people. 
The differential, at the present time, on fourth-class freight (a high 
average for classified freight) is $1.60 per ton. On sixth-class it is 
$1. When the board made its report and when Mr. Barnes made his 
plea, the St. Paul-Minneapolis merchant was getting his general 
merchandise on a basis of an average differential of $1, with no 
transfer charges at Duluth-Superior, while the differential in favor 
of the Duluth-Superior merchant was largely used up in the terminal 
charges at the head of the Lakes. Mr. Barnes’s statements were not 
made to show the enormous profit of private terminals, but to show 
what machinery could do over manual labor in handling freight. 
He did not claim the present terminals were making great profits, 
but that they could greatly reduce the expense to the public by put¬ 
ting in proper machinery. This they would not do, and he asked 
that the Government do it. In his estimate, he was comparing ma¬ 
chinery with hand labor, and it is not to be expected that he intended 
to cover all overhead charges. His appeal applied to general mer¬ 
chandise only. 

20. Public terminals .—The commissions count on public terminals 
to make the canal a success. Every item that the board has charged 
in its estimate for a lake vessel to canal barge coal transfer must 
enter into the cost of building and operating a public terminal 
to do the work, except that the State’s (or municipalities’) credit is 
enough better than the individual’s (or corporation’s) to get money 
at 4 per cent, whereas the coal merchant or company may have to 
pay 6 per cent and certainly will have to pay 5 per cent. It may be 
claimed that taxes would be avoided. If so, the remainder of the 
public would have to make it up, for the benefit of those using the 
coal dock. Public terminals are satisfactory for general merchan¬ 
dise, where the individual’s freight is received and stored by itself 
until removed, but it is not believed that a public coal dock could 
be managed unless the public go into the coal business. Terminals 
used as links in a business plan seldom charge excessively. Such 
terminals are coal docks, grain elevators, and railroad transfer docks. 
Their charges and costs may be unnecessarily high (as in the mer¬ 
chandise docks at Duluth-Superior) on account of lack of proper 
equipment. Such docks seldom figure more than a return on the 
investment, taxes, insurance, depreciation, labor, lights, and power. 
The profit comes from the business to which the terminal is a neces¬ 
sity. In such cases the institution of public terminals, without im¬ 
proved equipment, can not greatly reduce the cost. Farmers may 
subscribe to erect an elevator and then get their grain handled at the 
apparent cost of fuel and labor, but they are paying the difference in 
loss of interest on their money invested in the elevator, on its de¬ 
preciation and taxes, which the farmer fails to carefully note. In 
cases where all the terminals are owned by a terminal company, 
organized to pay dividends beyond the above enumerated items of 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 77 

cost, Government-owned terminals may benefit the public. The coal 
docks in Duluth-Superior are generally not railroad owned, nor are 
they owned by one company. Although coal dealers generally charge 
a nearly uniform price for coal, there appears to the board to be no 
excessive profit in it (paragraph 10 above). A portion of the ele¬ 
vators are owned by railroads, and the remainder are owned by 
several elevator companies. This arrangement provides, or should 
provide, competition. The general merchandise docks are said to be 
all railroad owned, and so are the steamers on the lakes which act 
in conjunction with them. It may be that in the case of general 
merchandise, some saving could be made by the introduction of 
proper machinery for handling package freight. It is doubtful if 
any material profit beyond the legitimate costs (with their crude 
way of handling freight) is made by these docks. Several railroads 
are concerned and that means competition, unless the railroads are 
actually in a combination to stifle competition. It is believed that 
such combinations may be controlled by existing laws. 

21. Railroad monopoly .—The commissions claim that the railroads 
monopolize the lake-and-rail traffic, and it is proposed to break this 
monopoly by (1) the construction of this canal, (2) public terminals, 
and (3) independent lines of steamers. The canal will parallel the 
last 152 miles of this monopoly, and can affect only that part of the 
traffic between Duluth-Superior and St. Paul-Minneapolis, including 
the Minnesota Transfer. This traffic in 1912 amounted to less than 
225,000 tons of flour from Minneapolis, and passing through the Min¬ 
nesota Transfer, and possibly 175,000 tons of package freight, allow¬ 
ing that one-half of all the miscellaneous freight handled between 
the Twin Cities and the Head of the Lakes was freight subject to 
lake-and-rail rates. This makes 400,000 tons of freight handled by 
the railroad-owned steamers, and affected by the canal, on which it 
is proposed that the Government expend $420,000 per year. The 
commissions fail to take into account the fact that this freight is 
only about 12.5 per cent of the entire tonnage between the Twin 
Cities and Duluth-Superior. There can be no justification for the 
expenditure of $420,000 annually unless the idea be to break the 
monopoly as a matter of principle and regardless of cost, and unless 
there is no other way to do it. The freight and differentials on this 
traffic over the 152 miles amount to an average of $1.26 per ton. The 
Government is asked to pay $1.05 per ton, leaving 21 cents for canal 
rate and extra terminal costs. 

[Note. —This discussion is made without reference to the recent 
decision of the Interstate Commerce Commission, which divorces the 
railroad-owned steamers from the railroads on the Great Lakes.] 

22. Costs of handling freight .—There is little doubt that the 
present handling of bulk freight (coal, iron ore, and wheat) is 
done in Duluth-Superior with the best modern machinery and that 
there is little or no profit in it to the terminal. It is rather coincident 
that the terminal charge on coal, with no profit to the dock, is 35 to 
40 cents and that on average grain is 36 cents per ton. With iron 
ore it is a question of practically a dump from car to vessel and 
therefore probably less expensive, although the investment is great. 
The commissions state (par. 125, G. D.) a cost of from 3 to 
10 cents per ton as a terminal charge on all freight. The board is 
greatly indebted to a gentleman, who declines to have his name 
mentioned, for much information on the subject of handling freight, 


78 WATERWAY EROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

he having given deep study to equipment and costs, in planning 
steamship docks with rail connections at both ends of the steamship 
line. His problem, therefore, is car to ship and ship to car. Looking 
into costs he was confronted with actual figures of cost of transfer 
of freight, simply from car to freight shed, on no less an authority 
than Mr. Kruttschnitt, of the Southern Pacific Railway. They were: 


Cents 
per ton. 

Portland, Oreg_46. 2 

San Francisco, Cal_27. 2 

Kansas City, Mo_33. 5 

Sacramento, Cal_33. 9 

Denver, Colo_23.7 

Salt Lake City, Utah_26.1 

Average_ 31. 8 

He then took up the cost of the complete transfer car to ship, or the 
reverse, and found: Cents 

per ton. 

Cost at San Francisco_50. 0 

Cost at Toledo, Ohio_ 35. 0 

Cost at New York and Jersey City___40. 0 

Cost at Superior, Wis_35. 7 

Cost at Erie Railroad Docks (by hand)__38.8 

Cost at Erie Railroad Docks (by motor truck)_29.1 

Average_37. 9 


These latter costs he obtained by visiting these places and going 
into figures carefully, in many cases basing his results on days of 
timed observance of the operations and not on statements alone of 
interested parties. He then took up the machinery question, visited 
docks where certain machinery was in operation, timed the opera¬ 
tions, and worked out his own figures of cost—labor and power only. 
He was at last forced to the conclusion that for short hauls on the 
level nothing could be found less expensive than hand labor with the 
regulation two-wheeled warehouse truck. This has to do the work 
in the car and in the ship (his ships load from side ports), and it 
does not pay to transfer to another conveyor for short distances, 
unless the grade is such as to render it difficult to handle the truck. 
In this conclusion he was well supported by evidence which he least 
expected. In the Railway Age Gazette of June 23, 1911, he had read 
of the remarkable plant for handling general freight put in by the 
Missouri, Kansas & Texas Railway at St. Louis. This plant (also 
described at length in the Engineering News of June 29, 1911) was 
conceded to be most complete. It consisted of telpher cars suspended 
from a monorail at the ceiling, of electric cranes, electric elevators, 
and automatic scales. The following quotations are taken from the 
article in the Railway Age Gazette: 

The cost of handling this freight by trucks has been about 45 cents a ton, and 
it is expected that after the plant has been in use this will be reduced to at 
least 30 cents. 

The total expenditure, including right of way, buildings, and track, is approxi¬ 
mately $3,000,000. 

In June, 1913 (about two years after its completion), he wrote for 
information as to the success of this plant. The following is taken 
from the letter he received from the general manager: 

The handling of freight in our St. Louis freight house by the telpher 
system has not been successful, and we are now rearranging the freight house, 
abandoning the telpher equipment. 
















WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 79 


Our cost lias been running from 55 to GO cents per ton with the telpherage 
system, and we can handle it by hand for 34 cents to 35 cents per ton. 

After giving the subject most careful study lie planned his dock 
to unload the cars and move the freight to the ship’s side by hand 
truck; from there is was to be taken to the ship on a moving plat¬ 
form, the outer end being lowered or raised to meet various water 
stages. Desiring to avoid the employment of the labor, he undertook 
to make a contract for handling freight. The contract price simply 
covers labor, power, and repair of machinery. In order to under¬ 
stand this contract it is necessary to note that two classes of labor 
must handle the freight. Dock labor takes it from the car and places 
it at the ship's side. Stevedore labor takes it from the ship’s side 
and puts it in the ship. Dock labor will not deliver it or receive it 
beyond the designated line, and stevedore labor will not receive or 
deliver it beyond the same line. When the ship is not loading, a cer¬ 
tain amount of freight can be put in the “ship’s side” area. If it 
has to be piled above a certain height an extra price is paid. What¬ 
ever can not be piled at the ship’s side has to be taken to storage in 
the warehouse. This costs the same as car to ship’s side. When this 
is again moved from warehouse to ship’s side, the cost is the same as 
car to ship’s side. Based upon these conditions the following was 
the best contract he could make: 

Car to ship's side or ship's side to car (cents per ton). 


Article. 

Straight. 

Excess height. 

Extra if stored. 

Total. 

Feet. 

Cost. 

Mini¬ 

mum. 

Maxi¬ 

mum. 

Flour. 

12.5 

15 

17.5 

12.5 or 17.5 

12.5 

35 

Grain. 

15 

8 

20 

15 or 20 

15 

40 

Bran, shorts, etc. 

15 

8 

20 

15 or 20 

15 

40 

Hay and straw, etc. 

17.5 

6 

22.5 

17.5 or 22.5 

17.5 

45 

Cased provisions. 

20 

8 

25 

20 or 25 

20 

50 

Barrels and kegs. 

15 

( l ) 

20 

15 or 20 

15 

40 

Paper in rolls. 

20 

0) 

25 

20 or 25 

20 

50 

General merchandise (limit 1 ton and 40 







cubic feet)_*. 

20 

8 

25 

20 or 25 

20 

50 

General merchandise (limit 1 ton and 80 







cubic feet). 

25 

8 

30 

25 or 30 

25 

60 

General merchandise (limit 1 ton over 80 







cubic feet). 

30 

8 

35 

30 or 35 

30 

70 


25 




25 

25 

Sugar, coffee, rice. 

12.5' 

8 

17.5 

12.5 or 17.5 

12.5 

35 

Fruits and vegetables (into ordinary cars) 

22.5 

8 

27.5 

22. 5 or 27. 5 

22.5 

55 

Fruits and vegetables (refrigerator cars). 

30 

8 

35 

30 or 35 

30 

70 


1 In tiers on flat. 


Loading or discharging ship (cents per ton). 


Article. 

In. 

Out. 

Remarks. 

General merchandise (limit 1 ton and 40 cubic feet). 

General merchandise (limit 1 ton and 80 cubic feet). 

General merchandise (limit 1 ton over 80 cubic feet). 

Sugar r i f* p, . _ _. 

30 

35 

45 

25 

30 

40 

25 

30 

35 

30 

32.5 

Per 1,000 feet b. m. 

flasAd provisions ... 


Vegetables (orated or sacked).. 


Oils (parrels or cases)... 


Peuient and fertilizers.., T . 

35 

25 

30 

32.5 

$1 

Flavor and grain 

TTay straw ground feeds,. 


PanAr in mils _ .. 


T,nmhftr lath shingles. 

























































80 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

The contract provided Tor the company’s furnishing all machinery 
and equipment, except stevedore’s gear for handling to and from 
ship; that the contractor should repair such equipment, but that the 
company should renew it. It also provided that the company should 
pay all extra cost of labor due to overtime, and that, in case the rate 
of dock labor should be increased, the rate per ton should be increased 
in proportion. The above contract prices therefore do not include 
any interest on investment, depreciation, taxes, or insurance. It is 
appreciated that it probably includes a profit, but when it is noted 
that the very cheapest transportation from car to ship (flour) is 37.5 
cents per ton, and that it may run as high as $1.15 (general merchan¬ 
dise over 80 cubic feet, unloaded, stored, above 8 feet, and loaded) it 
can scarcely be claimed that terminal charges (lake-to-rail or canal 
barge-to-rail) should be figured at 3 to 10 cents. The gentleman’s 
attention was called to this statement made under “ flour ” (second 
heading, S. D.) regarding public terminals in San Francisco: “ San 
Francisco is correcting it by installing modern unloading and han¬ 
dling apparatus, which will economically handle general freight from 
and to a steamer. We understand they have fixed a charge there, 
which covers their operating expense, at 5 cents per ton.” His reply 
was: “The docks in San Francisco are owned by the State. I have 
visited every modern steamboat dock in San Francisco at least ten 
times in the past year, looking for a dock location for ships. There 
is not a public-owned equipment in San Francisco for handling gen¬ 
eral freight. The public terminals do not undertake the handling 
of freight, they simply rent out the dock space at a figure per square 
foot which will pay interest on the investment, depreciation, and re¬ 
pairs. We have rented 100,000 square feet at 9 mills per square foot 
per month or for $10,800 per year. We expect to handle 75,000 tons 
of freight and therefore our rent will be a tax of 14.4 cents per ton 
on each ton handled and that does not pay a cent toward the cost 
of handling the freight, which we feel assured will not be less than 
50 cents per ton and are afraid it will prove to be nearer $1.” 

It therefore does not appear that the board’s charges are excessive. 
A comparison after further investigation shows: 


Article. 

Board’s 

charge. 

Proper 

charge. 

Source of information. 


Cents. 

25 

Cents. 

35 to 40 

Careful study of coal business. 
Independent estimate. 

Actual elevator charges. 
Above contract (minimum). 

Do. 

Do. 

Grain (bulk). 

36 

30 

36 

Grain (in sacks). 


40 

Iron and steel. 

25 

45 

Flour. 

33 

37.5 

45 

General merchandise. 

25 



It should be noted that the contract prices are for handling freight 
by the most economical equipment that could be devised by a practical 
man, after months of study, and that they include nothing but labor, 
power, and repair of machinery. The commissions state that all 
terminal charges should be from 3 cents to 10 cents. It must be con¬ 
cluded that the board’s figures were too low and that the commis¬ 
sions’ are more so. 














WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 81 


23. Average rail rate (paragraph Ilf , G. '/>.).—The board made a 
mistake in its original report in designating all freight, except coal, 
iron, flour, and grain, as “General merchandise.” It should have been 
called “ Miscellaneous freight.” It therefore includes many cheap 
commodities as well as general merchandise. The mistake is appar¬ 
ent, since the total freight is found by adding this item to the other 
four, and since the board, in getting at this item’s average rate by 
rail, used the rates on stone, cement, lime, salt, and sugar. Regard¬ 
ing the board’s determination of this rate, the commissions state: 
“ This method is obviously improper and the result inaccurate.” It 
is admitted that the method was more or less crude, but the board 
did not feel justified in asking, as suggested by the commissions, 
any one to give the tonnage of each article on the list. Since the 
freight involved in this item is only 10 per cent of the total tonnage, 
a mistake of 10 cents in its rate would affect the general average to 
the extent of only 1 cent. Sugar at $1.60 is the principal item cited 
in criticism of the board’s methods. As a matter of fact the all-rail 
rate on sugar from New York to St. Paul and Minneapolis is 30.5 
cents per hundredweight. The rail-lake-and-rail rate is 30 cents, 
and the rail-and-lake rate to Duluth is 25 cents over some roads and 
30 cents over others. A St. Paul merchant, handling large quanti¬ 
ties of sugar, states that scarcely any sugar comes to St. Paul via the 
Lakes, since the saving of one-half cent per hundred is not worth the 
delay. This is the exact amount (10 cents per ton) and the “ present 
business methods ” referred to by the board in paragraph 53 of its re¬ 
port. No wholesale merchant in St. Paul-Minneapolis would actually 
buy his sugar in Duluth-Superior and pay the local rate of $1.60. It 
therefore appears that sugar at $1.60 is not one of the largest items in 
the list; that instead of getting sugar from Duluth at a rate of $1.60, 
the St. Paul-Minneapolis merchant receives very little via Duluth- 
Superior; what he does receive costs him a differential of only $1 per 
ton; and, in preference, he gets it by rail from New York at a cost of 
$1.10 per ton over the cost to the Duluth-Superior merchant. At the 
time the board made its report the average differential on classified 
freight between Duluth-Superior and St. Paul-Minneapolis was $1 
per ton. Eliminating coal, iron, flour, and grain from the table in 
paragraph 49 (board’s report), there remain: 


Lumber- $1. 20 

Building stone- 1. 00 

Cement_ 1- 00 

Lime_ 1. 20 

Salt_ 1.00 


Sand_$1. 00 

Stone_t__1. 00 

Stone, crushed_ . 90 

Sugar_ 1. 60 


If sugar be changed to $1 (the actual differential) and classified 
freight be put in at $1, or its average differential at that time (and 
very little classified freight originates in Duluth-Superior or goes 
there from St. Paul-Minneapolis—in other words, pays a local freight 
rate), it will be seen that $1.16 was high and that, although the 
board’s method may have been improper, its results were not very 
inaccurate. Under present conditions, with the average differential 
on classified freight raised to $1.60 (see paragraph 19 above), the 
average rate on miscellaneous freight might go a few cents above 
$1.16. However, the whole item is only 10 per cent of all the freight 
handled. 


H. Doc. 1008, 64-1-6 












82 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


24. Points as to which local hoard is in error (paragraph 1%, 
G. 'D .).— (a) The board neither found nor assumed a reason for the 
decadence in inland waterway transportation. It simply treated it 
as a fact, and the board’s acceptance of that fact should not be taken 
as a hostile act toward all inland waterway improvement, nor does 
the board believe the decadence is due, in all cases, to unrestrained, 
cut-throat competition or to boycotting of such traffic by the rail¬ 
roads. It is the board’s belief that, in cases where it is cheaper to 
transport by water, the decadence is largely due to public apathy, 
and in cases where it is not cheaper the decadence is natural. 

(h) The terminal charges on coal (paragraphs 12 and 13 above) 
and on wheat (paragraph 18 above) and the degradation of coal in 
handling (paragraph 14 above) have already been covered. The 
board does not admit that terminal charges on freight can be reduced 
to 3 to 10 cents per ton (paragraph 22 above). It believes that about 
all that modern machinery can do is now being done on the Duluth- 
Superior coal docks, and that the cost of handling coal, even if the 
docks were public terminals, would be at least 30 cents for the entire 
service. It believes that similar figures could be found to apply to 
the elevators. On general merchandise the costs at Duluth-Superior 
might be somewhat reduced. Duluth-Superior would profit more 
than St. Paul-Minneapolis from such a reduction. 

( c) The average rail rate has already been discussed (paragraph 
23 above). The board did not assume that existing rates will remain 
as low as at present. The board did not, on any point, go into specu¬ 
lation for the future. It simply accepted present facts. Rail rates 
may increase. The railroads say they must increase to pay operating 
expenses—not to make increased dividends. Railroad expenses are, 
when the final analysis is made, dependent on the cost of material 
and labor. Exactly the same causes must increase canal rates. The 
board accepted existing rail rates and existing canal rates. The 
board also accepted the fact that the railroads are carrying the 
freight. If the time comes when they can not carry it, and the 
people must have the freight, the canal should be built regardless of 
cost. It will not then be a question of commercial feasibility; it will 
be one of commercial necessity. But under present conditions its 
feasibility is the question. 

(d) The board took what it considered reliable information on the 
total traffic in 1912, without putting any one to the trouble of giving 
it exact figures. Its figures appear to be too low, if those submitted 
by the commissions are correct. The effect of this would be to reduce 
the cost per ton to the public for the Government’s expenditure under 
each case (paragraphs 45a and 90, board’s original report). Since 
the cost to the public does not enter into the board’s general summa¬ 
tion (paragraph 89, board’s original report), its conclusions can not 
be changed whether actual commerce in 1912 (plus estimated local 
traffic along proposed canal) would have been three and one-third 
or four millions of tons. The board did not figure that the com¬ 
merce would increase 15 per cent each and every year from now to 
1920; the board had no right to assume such an increase. The ques¬ 
tion before the board was: Is the canal now T commercially feasible? 
and not: Will it be feasible or necessary in 1920? Great increase 
in rail rates may make it feasible some time, and increased traffic 
may make it necessary. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 83 

( e) The Erie Canal rate will be taken up in another paragraph. 

(/) ( 9 ) and ( h ). If these are errors on the board’s part, they are 
errors of judgment and not of fact. Whether they are errors at all 
must be left to the readers of the board’s statements. 

25. Flour. —The commissions mention flour next to general mer¬ 
chandise as the most productive of reduction in cost to the public by 
the introduction of handling machinery and public terminals. They 
state (Flour, S. D.), “All flour shipped by rail to Duluth is charged 
1G cents per ton for transfer from car to lake vessel.” Also under 
“Flour” (second heading, S. D.) they state, “The railroad and 
warehouse commission of Minnesota, on June 27, 1914, state such 
rate to be $0,058 per hundred, or $1.16 per ton.” Again (paragraph 
44, G. D.) they state that the board charged 35 cents to flour for 
transfer from mill to river in Minneapolis. The last statement is 
incorrect, and the other two differ from those of railroad officers and 
Minneapolis shippers of flour. A general freight agent writes: “ The 
cost of getting a ton of flour Minneapolis to Buffalo is only $1 per ton 
more than the cost of getting a ton of flour Duluth to Buffalo.” An 
assistant traffic manager writes: “The rates from Minneapolis to 
Buffalo include the handling from cars to boat, storage, and other 
incidental expenses.” It therefore appears, as allowed by the board, 
that $1 per ton from Minneapolis to Duluth-Superior absorbs all 
transfer and storage charges incidental to loading on to the lake 
vessel. While proper machinery could reduce the cost somewhat to 
the railroads, the public is getting flour handled at a better than 
average rate. Comparing flour with other articles granted com¬ 
modity rates, from f. o. b. Minneapolis-St. Paul to f. o. b. lake ves¬ 
sel or the reverse, we find the following costs per ton: 

Wheat, $1.33 (33 bushels to the ton). 

Coarse grain, $1.47 (average 47 bushels to ton, 1913). 

Flour, $1 (without storage or transfer charges). 

Hard coal, $1.20 (plus cost of transfer vessel to car). 

Soft coal, $0.96 (plus cost of transfer vessel to car). 

It does not therefore appear that any material reduction could be 
expected on the present flour rate. 

26. The Erie Canal rate. —The board’s authority for the Erie Canal 
rate is stated—the Interstate Commerce Commission. The commis¬ 
sions give (paragraph 23, G. D.) two authorities on average canal 
rates in the State of New York. Neither is a statement for the Erie 
Canal alone. The commissions have used an average rate for 10 
vears. This is no more justifiable than it would be to average the 
"freight rates from Duluth-Superior for the past 10 years—the rate 
on soft coal is stated to have been as low r as 75 cents per ton. (H. 
Doc. No. 304, 61st Cong., 2d sess., p. 23.) The board’s stated rate 
(3 mills per ton-mile) was for 1902—before the enlargement of any 
part of the Erie Canal; the commissions’ statement (from govern¬ 
mental source for all canals in New York State) for 1902 shows 
24 mills; the average for that year and the succeeding three years was 
2.475 mills; the last year given was 2.6 mills; but the commissions, 
by their method, get 2.14 mills per ton-mile. They state that the 
Erie Canal has deteriorated until it can carry only 4J feet. This 
shows that the comparison which the board made was quite accurate. 
Deterioration has put the Erie Canal (formerly 7 feet) on a parity 
with the proposed canal—each can safely and economically carry 


84 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

about 4J feet. The board still feels that the Erie Canal rate of 
3 mills per ton-mile is a proper charge. Yet the commissions, in mak¬ 
ing their summation (summary of saving, etc., S. D.), figure as 
low as mills and with the addition of terminal charges entirely 
too low find the canal would have saved the public nearly $2,500,000 
in 1912 and will save $5,000,000 in 1920. How is the rate of 1J mills 
per ton-mile obtained ? By a 17 per cent reduction of the actual cost 
of handling coal on the Monongahela Kiver—an 8-foot project, open 
river except four locks, entirely down-river haul, with locks which 
will take 3,000 tons of coal; “ three boats, 8-foot draft, with towboat, 
able to pass through the locks unbroken.” (Asst. Engineer Koberts, 
Exhibit 3, paragraph 2, G. D.) The passage of this 3,000 tons 
of coal through the four locks might take two hours. To pass the 
same amount of coal through the locks and lifts of the proposed canal 
would require 60 hours (2^ days) besides much slower progress 
through the canal between the locks. Again, delays are minimized 
on the Monongahela because they have double locks, so that two 
tows can be locked through at the same time. The actual cost quoted 
(1.8 mills), used in justification of a 2-mill rate on the proposed 
canal and then reduced one-quarter, was by a firm shipping 2,000,000 
tons from its own mines by its own boats to its own plant and there¬ 
fore entirely independent of anything (except at the locks, and they 
are double) which could delay them in the least. Everything could 
be arranged to produce the material, transport it, and unload it 
exactly as they wish. 

This record of 1.8 mills per ton-mile was the actual cost (no 
profit), and on coal. The commissions have reduced this cost to 1J 
mills for coal on the canal and call it a rate—thus making a rate 
cheaper than the actual cost on a great river under the most ideal 
conditions. It is also stated in the same document (Exhibit 3, 
paragraph 3, G. D.) that some shippers estimated their cost at 
“double the Jones & Laughlin figures.” Doubling the actual cost 
would be 1.6 mills and adding 1 mill depreciation would give 2.6 
mills. In Exhibit 4, paragraph 2, Mr. Koberts says that it is a 
question of “ area ” rather than depth. The proposed canal will 
have neither area nor depth and therefore its cost of transportation 
should not be compared with either the Monongahela Biver or the 
Great Lakes. Any single assemblage of a great cargo propelled by 
one power, whether it be in broad area of shallow depth, as on open 
river with large locks, or narrow area of deep draft, as on the 
Great Lakes, can carry freight cheaply; but when the cargo is con¬ 
tracted in both directions, such cheap rates can not result. Mr. 
Koberts’s final paragraph (Exhibit 4, G. D.) points out a canal which 
is estimated to carry coal at 20.1 cents or 1.44 mills per ton-mile, but 
when toll (30 cents) and other sources of profit are added (amount¬ 
ing in all to 40.1 cents) it becomes 4.3 mills. It should not be as¬ 
sumed that this 200 per cent is clear profit after counting interest, 
maintenance, and operation. The 30-cent toll probably covers all 
these items. Adding 30 cents, the cost becomes 3.6 mills, and this 
canal carries boats of four times the capacity and more than twice the 
draft of those on the proposed canal. This canal is even spoken of 
as a “ship canal.” The Erie Canal rate on wheat (and wheat is a 
commodity commanding a better than average rate) from Buffalo 
to New York city, is 4.5 cents per bushell or $1.50 per ton. The dis- 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 85 

tance is practically 500 miles but the last 150 miles is open river 
where the boats may be made up in fleets handled by a single tow¬ 
boat—a cheaper method of transportaion. Taking the distance as a 
canal haul all the way, the rate figures 3 mills per ton-mile. All in¬ 
vestigations made by the board, and even the figures produced by 
the commissions, tend to convince the board that its rate of 3 mills 
per ton-mile is not too large for the proposed canal. Since the 
length of the route is 260 miles, and the proper rate to apply is 3 
mills per ton-mile, the average canal rate from Duluth-Superior to 
Minneapolis must be taken as 78 cents. If the rate for coal is cut 
down, the rate for higher classes of freight must increase more in 
proportion, since coal is the greater part of the freight and 3 mills 
is an average rate. 

27. Past obstacles not necessarily applicable to future projects 
{paragraph G. D.). —The board has under consideration a pres¬ 
ent project and has considered present obstacles. Under various 
headings ( a to g) are discussed matters not before the board, as to 
national policy and remedial legislation. One paragraph of the 
comments leads the board to conclude that the author did not care¬ 
fully read the board’s report. The board did not assume an extra 
handling charge of 25 cents on coal at each end of the canal, and 
did not put a charge of 35 cents on flour from the mill to boat. 
The board assumed that flour could be loaded from mill to boat as 
cheaply as it is now loaded on cars. In this the board erred in 
favor of the canal. The mills are not convenient for river trans¬ 
portation and there will be no “ barge close at hand.” The board 
was influenced in making this concession to the canal by a statement 
of some Minneapolis people that they were planning a belt or an 
endless chain conveyor to take flour to their river terminal at low 
cost. It can not be transported and loaded on barges as cheaply 
as it is loaded on cars and the board should not have assumed that 
it could. But having made the assumption the board should not be 
charged with having put on 35 cents per ton for this service. 

28. Traffic Finding F (paragraph Ifl, G. D.). —There are some 
general statements in this paragraph to which attention is invited. 
Based on two premises—the Government’s expenditures on the Mis¬ 
sissippi River and the fact that 80 per cent of the commerce of the 
Great Lakes passes through the Soo Canal—the commissions con¬ 
clude that “ the logical destination of a Lakes-to-the-Gulf through 
waterway is a link joining the Mississippi River with Lake Su¬ 
perior.” As a matter of fact an analysis of the premises leads to an 
entirely different conclusion. The commerce through the Soo Canals 
for the year 1913 was 79,718,344 tons. Of this 72,844,560 tons were 
made up of iron ore, coal, and wheat (roughly 48,000,000, 18,500,000, 
and 6,000,000, respectively). Iron ore should be left out of any 
material consideration for the canal, since it is used at Duluth, at 
points on the lower Lakes, or at points reached from the lower 
Lakes. If conditions should ever change so that a demand for 
iron ore should arise in St. Paul-Minneapolis, or lower down 
on the Mississippi River, the rapidly developing mines around 
Brainerd would furnish it. Brainerd is 129 miles from Minneapolis 
and ore could be put at the smelter’s door with no charge except 
freight. The nearest mines to Duluth are about 75 miles. Ore 
to St. Paul-Minneapolis via the canal would require 75 miles 


86 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

by rail and 260 by canal and river, would have to be transshipped 
at Duluth-Superior, and would have a terminal charge at St. 
Paul-Minneapolis. Ore for down-river use would have equal termi¬ 
nal charges; one source (Brainerd) would be 129 miles by rail 
and 40 by river, to Prescott; and the other would have 75 by rail and 
220 by canal. In considering coal, only that part destined for St. 
Paul-Minneapolis and tributary country can be affected. At the 
present time the price of coal in St. Paul is largely dependent on the 
cost of getting Illinois coal with an all-rail freight rate of $1.40 per 
ton. Improvement of the Mississippi River, if followed by resump¬ 
tion of navigation, should put Illinois coal into St. Paul-Minneapolis 
at a less rate and should diminish, rather than increase, the con¬ 
sumption of eastern coal. At least no great territory southward 
along the Mississippi should be expected to be supplied via Duluth- 
Superior as a result of the conditions cited. Wheat, considering the 
great movement, goes to Duluth-Superior by rail direct from the 
farm, and not through St. Paul-Minneapolis. The large shipment 
of coarse grains does not go by Lake Superior—only the small amount 
raised in the wheat country and a small portion drawn from the 
northern part of their principal area of production. 

The commissions cite the price of coarse grains in New York as 
compared with the prices in Chicago as a reason for the canal. In 
the eastern States the production and consumption of coarse grains 
are more evenly balanced than in the case of wheat. Wheat is raised 
mostly north of St. Paul-Minneapolis. Duluth-Superior and the 
Great Lakes are its natural outlet to its great market—the eastern 
United States and Europe. Coarse grains are raised south of St. 
Paul-Minneapolis, and their market is in the Middle West and the 
South, where large quantities are Consumed and little raised. Their 
natural trend is, therefore, toward Chicago and St. Louis. The price 
is higher in New York than in Chicago, but the great demand is not 
in New York, and Lake Superior is out of the natural line from the 
great producing area to the market. The country immediately sur¬ 
rounding Lake Superior produces little of anything which would 
find a market in the South. Neither is it a region of great consump¬ 
tion. Aside from Duluth-Superior, the iron range, the Ashland 
country, and the copper country, there is little population. What 
it does consume it either produces itself or gets from the East by 
the Lakes at a much cheaper rate than can be had by the Mississippi 
River. It is not believed that the tonnage that may develop “ be¬ 
tween Lake and Gulf, between the Mississippi Valley and the Pacific 
via the Panama Canal” will touch Lake Superior. The proposed 
canal is not “ through the center of the United States,” but far toward 
its northern border. Lake Superior territory is not a large pro¬ 
ducer, except in iron ore, copper, and wheat—its lumber business 
having nearly departed. It is not a large importer except in the 
coal and general merchandise consumed in its natural territory. Its 
natural territory, on account of the Mississippi River, is limited to¬ 
ward the south. Its large territory to the west (the Dakotas and 
Montana) is naturally reached without going south 150 miles to St. 
Paul-Minneapolis. The wheat that finds outlet to the “ Pacific via 
the Panama Canal,” to the South for domestic consumption, or to New 
Orleans for export to Europe (if such trade develops) will not go 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 87 


to Duluth and use the canal. Duluth is not in the wheat territory, 
but far east of it. Any wheat attracted away from its present route 
and to the Mississippi River will not go to Lake Superior, except it 
be to reach Chicago via the Lakes, should Chicago become the head 
of 8-foot navigation on the Mississippi River system. The threatened 
revival of navigation on the Mississippi River, to include export wheat 
and flour, will undoubtedly divert commerce which now parallels the 
proposed canal. Lake Superior has a wonderful commerce, because 
it is the natural water route from the great iron mines to the great 
furnaces, because the Great Lakes make a cheap outlet for the wheat 
crop in its natural direction to market, and because they furnish a 
cheap route for coal from its great production center to the North¬ 
west. But Lake Superior neither receives nor produces anything 
that would naturally go in large quantities far south of Prescott, 
Wis.—the junction of the proposed canal with the Mississippi River; 
neither would Lake Superior draw to any extent anything from the 
territory south of that point. Its coal, even as far south as St. Paul- 
Minneapolis, is largely cut into by Illinois coal, and resumption of 
navigation on the Mississippi River should increase the use of Illinois 
coal. 

29. Recapitulation and comment .— (a) In paragraph l\b (G. D.) 
the commissions claim that the board charged coal with a 25-cent 
terminal cost at each end of the canal. The board charged 25 cents 
for the entire extra handling of the coal shipped by the canal and 
not 25 cents at each end. Terminal charges on coal and wheat have 
been investigated again by the board and its original figures still 
appear warranted; also the degradation charge to coal due to extra 
handling and the cost of delivery in St. Paul-Minneapolis. (Para¬ 
graphs 8 to 20 above.) 

(b) In total tonnage for the fiscal year 1912 (paragraph 11c, 
G. D.) the commissions’ figures show somewhat more than those of 
the board (about 26 per cent more). The commissions’ figures for 
1920 may or may not materialize. (Paragraph 24c? above.) 

(c) The average rail rate (paragraph 11/, G. D.) has been found 
to have been large, rather than small, under the conditions existing 
at the time the board wrote its report. Under present conditions, 
with the soft-coal rate raised 6 cents and the average general mer¬ 
chandise differential raised from $1 to $1.60, the average rail rate 
would figure about 8 cents higher than the board’s estimate of $1,024. 
(Paragraph 23 above.) 

(d) The additional tonnage outlined in paragraph 21 (G. D.) has 
been partially discussed and is still believed not to be available. 
(Paragraph 28 above.) Many claims made in paragraphs 21 and 22 
(G. D.) do not appear to require an answer. 

(e) The Erie Canal rate used by the board (3 mills per ton-mile) 
appears warranted and its application to the proposed canal seems 
justified. (Paragraph 26 above.) 

(/) Public ownership of terminals (paragraph 36, G. D.) has 
been covered and there appears to be no great benefit applicable to 
the proposed canal. (Paragraph 20 above.) 

(g) Regarding the United States Steel Corporation (paragraph 
42, G. D.) comment was made in original report, but it is pertinent 
to state that cement is delivered from Mason City, Iowa, to the car- 


88 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

load consumer or retail dealer in St. PauFMinneapolis at $1.20 per 
ton, and the rail rate from Duluth is only $1 per ton delivered on any 
siding. 

(A) The great saving of terminal charges outlined in paragraph 
43 (G. D.) has been covered and believed to be overestimated and 
helped out by a canal rate below what is justified. 

(i) In the handling of flour (paragraph 44, G. D.) it is stated that 
the board charged 35 cents for loading on barges at Minneapolis 
over the present cost of loading on cars. This statement is erroneous. 
Under “Flour” (second heading, S. D.) the commissions give the 
rate to Duluth as $0,058 per hundred. The rate on through flour for 
the east (the great bulk of flour) is 5 cents per hundred f. o. b. 
Minneapolis to f. o. b. lake vessel. Under the first heading, “Flour,” 
it is stated that all flour is charged 16 cents for transfer at Duluth. 
Nothing is charged for transfer or storage at Duluth. (Paragraph 
25 above.) 

(j) In paragraph 46 (G. D.) many more claims are made for 
freight for the canal, of which little will materialize. 

(k) Matters discussed in paragraph 47 (G. D.) have been covered 
by the board and found to be claims which do not apply to the 
proposed canal. (Paragraph 28 above.) 

(l) Under “Canal rate” (S. D..) this statement is made: 

It only costs 5 cents per ton to take coal from lake vessel, put it on dock, 
screen it, and load it into cars. 

As a matter of fact (about which there can be no doubt) the actual 
cost including storage is at the very least 35 cents and probably 
nearer 40 cents. All the estimates of the commissions for terminal 
charges should be similarly increased. The board’s estimates are 
believed to be conservative. 

(m) Under “Transportation by canal involves, etc.” (S. D.), it is 
stated that the board charged grain transfer at Duluth-Superior to 
the canal-hauled grain and did not charge it to rail-hauled grain. 
There is also found the statement: 

This is absolutely inaccurate and is not and can not be justified from any 
standpoint or by any authority. 

The board has been informed that the commissions expressed a 
desire to withdraw this statement, having found that the board made 
no such discrimination. No communication having been received 
upon the subject, the board has decided to submit its report with this 
reference to the matter. 

(n) Under “Conclusion” (G. D.) the commissions offer coopera¬ 
tion to the extent of providing public terminals. It has been shown 
that in the handling of iron ore, wheat, and coal no great saving 
could be made over the present handling. To quote from “ Flour ” 
(second heading, S. D.) : 

Mr. Barnes shows rather conclusively that, with the exception of coal, iron 
ore, and grain, the lake transportation upon which the Government has ex¬ 
pended more than $100,000,000 is of no particular benefit to the public by way 
of reduced freight rates. 

Of the seventy-nine and three-quarters millions of tons of freight 
passing through the Soo Canals in 1913, “ coal, iron ore, and grain ” 
made up seventy-five and one-third millions. Therefore, as shown by 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 89 

the board, and as may be implied from Mr. Barnes’s statement, the 
advantages from public terminals would apply, to any material ex¬ 
tent, to only 5.5 per cent of the freight passing the Soo Canals, and 
even on that amount the construction of the proposed canal should 
not be the only way to remove the difficulty. 

( o ) Regarding cooperation, the board feels that the proposed 
canal is so local in its nature that cooperation in its construction, far 
beyond the furnishing of public terminals, should be offered before 
the United States should consider undertaking the work. 

30. Position of the commissions. —The commissions apply open- 
river conditions to a narrow and shallow canal; and even claim that 
a canal rate can be had equal to or less than the actual cost on an 
open river. They couple with this terminal charges which include 
only a few items of the expense of such terminals, and thus arrive 
at a great saving to the public from the construction of the canal. 
Claiming these low terminal rates can be had, they assume that the 
present terminal rates are excessive and that public terminals will 
result in great saving to the public. In these claims they are believed 
to be wrong as to all items entering largely into lake commerce—ore, 
coal, grain, and flour. This practically reduces the argument to the 
general merchandise, to which the lake-and-rail rate applies. On this 
there is an average differential of $1.60 per ton. They claim this 
differential is too great for a distance of 152 miles. It does appear 
great—1.05 cents per ton-mile—but it must not be overlooked that 
it includes a transshipment. Transshipment must be made whether 
the freight goes on to St. Paul-Minneapolis by rail or by canal, and 
transshipment of general merchandise is more expensive than that 
of the articles which make up the bulk of the lake freight. If the 
cost of transshipment be added to the canal rate, and the sum be sub¬ 
tracted from $1.60, there will be little left to justify the canal for 
handling general merchandise. There is little or nothing to justify 
it from the standpoint of coal, ore, grain, or flour. 

31. Conclusion. —In view of the above the board still adheres to its 
original recommendation that the proposed canal connecting Lake 
Superior and the Mississippi River by way of the St. Croix River 
is not now feasible and practicable considering the necessary location, 
plans, cost of construction, commerce affected, and water supply. 

Chas. L. Potter, 

Lieutenant Colonel , Corps of Engineers. 

E. D. Peek, 

Major , Corps of Engineers . 


JOINT RESOLUTION MEMORIALIZING CONGRESS IN FAVOR OF A CANAL CON¬ 
NECTING LAKE SUPERIOR WITH THE MISSISSIPPI RIVER VIA THE BRULE AND ST. 
CROIX RIVERS, AND PROVIDING FOR THE APPOINTMENT OF A COMMISSION TO PRO¬ 
MOTE THE CONSTRUCTION THEREOF AND TO ACT IN CONJUNCTION WITH COMMIS¬ 
SIONS APPOINTED BY OTHER STATES. 

Whereas the Congress of the United States, by two several and separate acts 
passed in the years 1894 and 1899, authorized and directed two separate sur¬ 
veys and examinations of three proposed routes for a canal connecting Lake 
Superior with the Mississippi River, one of said routes being from Lake 
Superior to the Mississippi River via the St. Louis River, one via the Rum 
River and one via the Brule and St. Croix Rivers; and 



90 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Whereas, after an actual examination and survey of said several proposed 
routes, the United States Government engineers did report in the year 1894 
that the most feasible route for said canal is the route from Allouez Bay, on 
Lake Superior, via the Brule and St. Croix Rivers to the Mississippi River, 
and recommended said route; and 

Whereas in the year 1899 the United States Government engineers did again 
report that a canal from Lake Superior to the Mississippi River via the 
Brule and St. Croix Rivers was entirely feasible; that in the first of said 
reports of said Government engineers it was estimated that said canal could 
be constructed 7 feet deep, 80 feet in width at the water surface, and 59 feet 
in width at the bottom thereof for the sum of $7,050,000; and in the second 
of said reports it was estimated that said canal could be built 80 feet in width 
at the water line, 59 feet in width at the bottom, and 5 feet deep for the sum 
of $6,012,500; and 

Whereas the project of constructing said canal has not been authorized by 
Congress because of reports of said engineers to the effect that the construc¬ 
tion of said canal was not warranted, owing to existing railroad competition 
and the cost of said canal as compared with the benefits to be derived from 
the construction thereof; and 

Whereas it conclusively appears from the surveys and examination of the 
route made by the Government engineers that it is entirely feasible and 
practicable to construct and operate said canal along the route specified from 
Allouez Bay, on Lake Superior, via the Brule and St. Croix Rivers to the 
Mississippi at the junction of the St. Croix and Mississippi Rivers, and the 
only objections which apparently prevent Congress from authorizing said 
project are the existence of railway competition and the doubt expressed by 
said engineers as to the amount of commerce which would be carried upon 
said canal; and 

Whereas no survey or examination appears to have been made or authorized 
by the United States Government of said route to ascertain whether the same 
could be constructed and operated at a depth of 10 feet, nor as to whether 
a canalization of the Mississippi River by the construction of a dam below 
the junction of the St. Croix and Mississippi Rivers would be practical, which 
would in fact extend said waterway so as to connect the cities of Minneapolis 
and St. Paul with the cities of Duluth, Minn., and Superior, Wis., by means 
of said canal and the canalization of said Mississippi River; and 
Whereas millions of consumers and producers of the Northwest and the Mis¬ 
sissippi Valley are vitally interested in the construction of said canal and 
the improvement of said Mississippi River so as to form a complete and con¬ 
tinuous inland waterway from the Mississippi Valley and the twin cities to 
the Atlantic seaport via the Great Lakes, thus enabling all of the products 
of the Eastern States and the States bordering on the Great Lakes to be 
shipped by water to all points in the Northwest and the Mississippi Valley 
and the agricultural and other products of the Northwest to be shipped by 
water-to the market of the world; and 

Whereas at all of the hearings held upon the question of the commercial 
necessity of said canal and waterway a great mass of producers and con¬ 
sumers interested have had no adequate opportunity to be effectively heard, 
and there is no lawfully constituted authority, official, or commission of this 
State authorized or empowered to ascertain and present the facts or collect 
data and statistics relating to commerce bearing upon this important subject; 
and 

Whereas the State of Wisconsin and the people of said State are also greatly 
interested in the construction of said canal and waterway: Now, therefore, 
be it 

Resolved by the House of Representatives of the State of Minnesota (the 
Senate concurring) , That the construction of said canal by the National Govern¬ 
ment is of the greatest importance to this State, the State of Wisconsin, the 
Mississippi Valley, and the Nation; that its construction will be a great addition 
to existing facilities of commerce; that it would constitute a natural, adequate, 
and automatic means of reducing transportation rates on all commodities be¬ 
tween the Mississippi Valley, the great Northwest, the Great Lakes, and the 
Atlantic seaports, and that it would tend to reduce rates upon coal, iron, steel, 
manufactured articles, grain and other agricultural products, and would greatly 
benefit the consumers and producers of the East and the West and reduce the 
cost of the necessities of life. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 91 


Resolved further, That the governor of this State, the drainage engineer of 
this State, the chairman of the hoard of railroad and warehouse commissioners 
he, and they are hereby, appointed a commission, of which the governor shall 
be chairman, which shall be known as the Lake Superior and Mississippi River 
Canal Commission, and said commission is hereby granted power and authority 
and is hereby directed to investigate and ascertain all of the facts with reference 
to the practicability and cost of construction and operation of said canal, utility 
thereof, and the character and amount of commerce which would probably be 
carried or affected by said canal, and the probable effect of the construction and 
operation thereof upon transportation rates and upon the consumers and pro¬ 
ducers of the Northwest, and especially the States of Minnesota and Wisconsin, 
provided, however, that the expenses of such commission in carrying out the 
provisions hereof shall not exceed the sum of $2,500. Said commission is hereby 
directed to lay before the United States engineers, and any other Federal com¬ 
mission, board, or authority having jurisdiction of any question relating to the 
construction of said canal by the United States Government, all of the facts, 
conclusions, statistics, data, information, and views ascertained and gathered by 
said commission hearing upon the advisability and practicability of tlie construc¬ 
tion of said canal by the Federal Government, and to make or cause to be made 
any and all arguments deemed necessary by said commission in favor of said 
canal, and to use their best efforts to further the project of the construction 
thereof, and to report to the legislature at the session of 1915 all of their acts 
and doings in the premises. 

Resolved further , That said commisssion is also authorized and directed to 
confer and act with any commission designated or appointed by the State of 
Wisconsin or any other State interested in the construction of said canal, and to 
act with any such commission in any and all of the matters hereinbefore set 
forth. 

Resolved f urther, That the State of Wisconsin is hereby requested and invited 
to constitute and appoint a like commission for the purpose of consulting and co¬ 
operating with said commission hereby appointed for the purpose of furthering 
the project of constructing said canal. 

Resolved further, That the Senators and Representatives in Congress of the 
United States for the State of Minnesota are hereby requested to urge upon 
Congress the adoption of an act authorizing the final survey of said canal at a 
depth of 10 feet, together with the extension of said canal by means of the 
canalization of the Mississippi River to the cities of St. Paul and Minneapolis, 
and to urge upon Congress the final construction of said canal by the United 
States Government. 

Resolved further, That a copy of this resolution be sent to the Senate and 
House of Representatives of the United States and to each of the Senators and 
Representatives in Congress from this State, and that a like copy he transmitted 
by the governor of this State, to the governor of Wisconsin, and to the president 
of the Senate and speaker of the Assembly of the State of Wisconsin. 

Approved March 31, 1913. 


LETTER OF THE UPPER MISSISSIPPI RIVER IMPROVEMENT ASSOCIATION. 

Burlington, Iowa, June 2If, 191If. 

Gentlemen : In regard to the matter of appeal of the Minnesota and Wiscon¬ 
sin Canal Commissions from the report of the local board of United States Army 
engineers at Duluth, Minn., dated May 14, 1913, reporting that the proposed 
Lake Superior-Mississippi River Canal is not now commercially feasible and 

practicable. , 

I had intended and planned, as the representative of the Upper Mississippi 
River Improvement Association, to attend the hearing of the appeal by your 
board to be held June 30 instant; but at the last moment, owing to serious illness 
in my family, I find I will be unavoidably prevented from being present. 

At the outset I beg to say that the Upper Mississippi River Improvement Asso¬ 
ciation is composed of representatives of the five States of Minnesota, Wisconsin, 
Illinois, Iowa, and Missouri, its object being the improvement of the upper Mis¬ 
sissippi River and its tributaries and the development of transportation thereon. 

For a number of years the project of the proposed canal connecting Lake 
Superior with the Mississippi River at the mouth of the St. Croix River has 
received the unanimous indorsement of the association at its annual conventions 



92 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


attended by the representatives of the five States mentioned, it being con¬ 
sidered that said canal would be a great benefit to and afford a large saving 
in the cost of transporting a vast amount of the commerce of the upper Missis¬ 
sippi River Valley, in connection with the Great Lakes and the Mississippi 
River. 

It is to be regretted that the local board of engineers, in its report, reported 
that the proposed canal is not now commercially feasible and practicable, 
although it is shown by reports made by United States Army Engineers that its 
physical construction and maintenance is feasible and practicable. 

Upon careful reading of its report I find some of the statements predicated 
upon conditions that can be and should be eliminated and corrected, and others 
that are not founded on fact, and that it was mainly on account of these that 
the local board arrived at the conclusions it did. 

While not for a moment impugning the statements of the local board, it 
would seem as though they had been unconsciously based on erroneous informa¬ 
tion in some respects as to the commercial feasibility of the canal. It may, 
therefore, be well to refer briefly to one or two of the items set out in the 
report. 

Prospective commerce .—This can not be measured by present conditions 
covering the attitude of the railroads which has long existed in antagonism 
to inland water transportation. If this is to be allowed to continue, then 
there would be no incentive to either improve present or to create artificial 
waterways. But this condition must be eliminated by Federal and State legis¬ 
lation compelling coordination and cooperation between rail and water lines. 
With this barrier removed the rivers and canals would receive their just share 
of commercial traffic. 

The cost of transportation by canal .—This is greatly overestimated in the 
report of the local board, especially as to loading, unloading, and transit costs, 
and deterioration in handling of coal. With modern barges and towing outfit, 
and proper terminal facilities, the total cost would be very much less than the 
amount estimated by the local board. If given a fair field, transportation costs 
on the canal would be much less than the cost by rail between termini on all 
commodities and would attract a large share of the present and increasing 
tonnage tributary to it. 

The canal would be the connecting link furnishing an all-water route from the 
Atlantic seaboard to the Mississippi River, via the Hudson River, the Erie 
Barge Canal, and the Great Lakes, and the reduction of transportation costs 
that would be obtained thereby would be an economic saving to the people living 
in the Mississippi Valley. 

I refrain from going more into detail or quoting figures and statistics for 
the reason that the whole subject is exhaustively covered in the appeal of 
the Minnesota and Wisconsin canal commissioners submitted to your board, in 
which I heartily concur. 

I trust after you have carefully considered the appeal as a whole and com¬ 
pared its statements with those of the local board of engineers in its report, that 
you will find thereupon that the report should not be concurred in and that the 
project should be recommended as commercially feasible and practicable. 

Respectfully submitted. 

Very sincerely, yours, 


The Board of Engineers for Rivers and Harbors. 


Thos. Wilkinson, 

President. 


STATEMENT SUBMITTED TO THE BOARD OF ENGINEERS FOR RIVERS AND HARBORS. 

Gentlemen : In the report of preliminary examination of the proposed Lake 
Superior-Mississippi River waterway by United States Engineers C. L. Potter, 
F. R. Shunk, and E. D. Peek (H. Doc. No. 920, 63d Cong., 2d sess.) Minneapolis 
is designated as the commercial terminus of the project. 

Minneapolis is likewise designated as the head of Mississippi River navigation 
in the $20,000,000 project for the improvement of the upper Mississippi, which 
is now supposed to be near completion, and by another year it is hoped that 
this city will be head of navigation of the Father of Waters in fact as in name. 

The completion of the so-called High Dam across the Mississippi near the 
tnterurban line between Minneapolis and St. Paul, which will carry 9 feet depth 



WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 93 


of slackwater into the heart of the Minneapolis milling district, is the final 
chapter in the extension of Mississippi navigation into the leading manufac¬ 
turing metropolis of the Northwest and the opening chapter, it is hoped and 
believed in the development of a substantial and growing volume of commerce 
on the upper Mississippi. The completion of this dam, with its 15,000 to 18,000 
horsepower of hydroelectric development, will doubtless add somewhat to the 
industrial activity of the city. Minneapolis has for many years owed much to 
the river. Indeed, it was the Falls of St. Anthony, discovered by Father 
Hennepin in 1680, that led to the location of the city and afterwards to the 
development of its great flour milling, lumber, grain, woodworking, and other 
industries. The city grew up around the falls on the two banks of the river 
until to-day Minneapolis spreads over 53 square miles of area and has a popula¬ 
tion which numbered 301,000 in the census of four years ago and is now 
estimated at 335,000. 

To the 30,000 horsepower of the original Falls of St. Anthony, upon which 
the milling industries largely rely for power, the rapids immediately below add 
12,000 to 15,000 for the operation of the Twin City Rapid Transit system, 
which furnishes the electric street railway service for St. Paul and Minneapolis 
and for an extensive suburban service extending east from St. Paul to the city 
of Stillwater and west from Minneapolis to Lake Minnetonka. The further 
High Dam development of 15,000 to 18,000 horsepower will make about GO,000 
horsepower which the Mississippi River contributes to the industrial and transit 
development of that metropolitan district. And yet that is not all of the story; 
for much of the 28,000 horsepower of St. Croix Falls, located on the Mississippi 
tributary which is the major factor in the proposed waterway project, is 
conveyed by cable into Minneapolis for city lighting and industrial use and 
still again the large waterpower developed on the Mississippi about 18 miles 
above Minneapolis, near Anoka, is largely for Minneapolis supply. 

The point I wish to convey in referring to this large use of waterpower fur¬ 
nished Minneapolis by the Father of Waters is threefold, thus: 

First. That Minneapolis is essentially a Mississippi River metropolis, the 
river flowing through its heart for a distance of a dozen miles, with the princi¬ 
pal industrial and jobbing centers close by on either shore and furnishing the 
prime source of its industrial and commercial development. 

Second. That as a manufacturing center which needs extensive transportation 
facilities for moving heavy commodities it ranks next after St. Louis and 
Pittsburgh in the entire area of the Mississippi watershed. 

Third. That Minneapolis, now ranking among the 10 largest cities in the 
country in volume of manufactures and bank clearings, is a growing city in 
both industries and commerce, and to-day is thoroughly awake to the need and 
the value of water transportation, which will be afforded by upper Mississippi 
navigation improvement and the proposed extension into the Great Lakes via 
the canalization of its important tributary—the St. Croix River. 

By authorization of the Minnesota State Legislature at the last session 
Minneapolis is now issuing .$300,000 of municipal bonds to build public docks 
for the accommodation of river boats which will enter Minneapolis on the 
slackwater to be provided on the completion of the Mississippi High Dam. 
Work is already begun under the city engineer for these municipal improve¬ 
ments. 

At a convention of Minneapolis manufacturers and jobbers under the auspices 
of the Civic and Commerce Association of Minneapolis last December, 1,000,000 
tons of freight were pledged by Minneapolis business men to a river fleet 
entering Minneapolis. 

Within the past fortnight the chairman of the waterways committee of that 
commercial body, Mr. Wilbur F. Decker, an experienced business man and 
engineer, embarked for Europe to make a study at first hand of the successful 
waterways of Germany, France, and the Netherlands. 

Minneapolis has been known for years as the leading flour milling city of the 
world. The product averages about 18,000,000 barrels a year, of which the 
bulk, upward of 800,000 tons, is for shipment largely to Atlantic and European 
markets. 

Minneapolis is likewise the largest primary wheat market of the world, 
handling about 100,000,000 bushels of milling wheat during the grain season. 
Minneapolis is also the largest primary flaxseed market of the world and the 
largest manufacturer of linseed oil and oilcake. It likewise leads in other 
cereal manufactures, such as breakfast foods made from wheat, oats, and 
barley. Total grain receipts at Minneapolis approximate 160,000,000 bushels 
per annum. About 80 per cent of the grain received is converted into various 


94 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RTVER. 


manufactured products named and shipped in finished form, and the remainder, 
except what is required for home consumption, is shipped as grain. 

Formerly the bulk of Minneapolis breadstuff shipments went via the Lakes 
and Erie Canal and railroads to New York. To-day Montreal is a large re¬ 
ceiver of Minnesota grain and flour shipment for export. When Theodore 
Roosevelt was governor of New' York he sent the New York Canal Commission 
to Minneapolis to inquire of Minneapolis flour and grain men why they had 
practically cut New York out of their business. The answer was that New 
York had allowed its canal and river and harbor equipment and terminal 
facilities to fall under railroad control so that the western shipper could no 
longer rely upon water transportation into New York. As a result the induce¬ 
ments of Montreal carried away from New York the grain and flour export 
traffic. 

New York is now endeavoring to remedy the conditions by which it lost 
something like 75,000,000 bushels of western grain per annum, and with a new 
$120,000,000 Erie Barge Canal and about $20,000,000 additional for public 
terminal facilities, is bidding for the grain and flour business of the upper 
Mississippi Valley. New steel barges of 1,000 to 3,000 tons will carry New 
York merchandise and manufactured products to Buffalo, and return to New 
York Harbor with Minnesota grain and flour and other cereal and agricultural 
products. The Great Lakes fleet will convey the cargoes each way between 
Buffalo and Duluth, a distance of 900 miles, for a charge equivalent to a rail 
charge for 100 miles. If the proposed Lake Superior waterway to the Mis¬ 
sissippi will complete the water route from the New York to the Minneapolis 
dock, Minneapolis manufacturers and merchants may equip their own mer¬ 
chant fleet and secure a rate into New York about equal to the present rail 
rate from Minneapolis to Chicago. Such an achievement would certainly open 
an era of marked industrial and commercial development for Minneapolis and 
the great agricultural empire tributary. 

It seems that the local board of engineers for the upper river and lake 
district in which this project is located accepted railway terminal charges of 
35 to 44 cents for flour and grain as the cost per ton for handling these 
commodities in loading and unloading the river and canal boats. However, 
they doubtless have heard by this time that the work can be done much more 
economically. Instead of using roundabout railway switching at a cost of 35 
to 44 cents per ton at each end of the canal and river route, shippers 
may avail themselves of modern and up-to-date loading machines and methods 
which to-day load and unload harbor craft at 3 to 5 cents per ton. 

It appears that the largest steel and wire company in the United States has 
filed with the Lake Superior and Mississippi River Canal Commission, of which 
the governor of Minnesota is ex officio chairman, a plan for an aerial tram¬ 
way which will convey Minneapolis flour from the mills and load it in the 
barges on the river at less than 4 cents per ton covering labor, power, repairs, 
maintenance, and interest on the capital investment. Grain doubtless may 
be handled with similar economy. Specific gravity aids in the process by 
reason of the difference of 50 to 100 feet between the elevation of the flour 
mill and grain elevators above level of the river. Similar costs of transfer¬ 
ence from canal barge to lake vessel at Duluth-Superior Harbor by floating 
elevators or otherwise are estimated. 

These economies in handling cost, which for the two ends of the waterway, 
net a saving of 60 to SO cents per ton on flour and grain shipment, appear to 
remove completely the obstacle to commercial feasibility of the waterway as 
applied to cereal commodities and general agricultural products and open the 
way to a tonnage of 1,000,000 to 3,000,000 tons per annum of such freight for 
water transportation from Minneapolis and the large agricultural territory 
tributary. 

Minneapolis is specially interested in lake coal, receiving about 2.000,000 
tons from the head of the lakes per annum at the present time, and capable of 
using a vastly greater tonnage if reduced cost of transportation would make 
such increase available. All manufacturing plants using hydroelectric power 
require steam auxiliaries during periods of low water. Thus the mills, the 
street railway, the electric lighting and power company, all have important 
steam auxiliaries which require coal. The gas company uses a large tonnage. 
The foundries and factories and office buildings and railway shops require a 
largely increasing annual tonnage of steam coal, while 335,000 domestic con¬ 
sumers require anthracite even if it costs over $9 per ton. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 95 


Some Illinois coal is brought in at a transportation cost of $1.80 to $2.20 
per ton by rail; but it is not the equal in quality of the lake coal which comes 
in from Duluth at 90 cents for soft and $1.25 for hard for rail cost to the coal 
company. The lake rate of only 30 cents from Lake Erie to Duluth, added to 
the rail rate to Minneapolis, gives Pittsburgh, Hocking, and West Virginia coal 
a lower transportation cost from Lake Erie to Minneapolis than the rail rate 
from southern Illinois mines to Minneapolis. 

If the proposed Lake Superior-Mississippi waterway will further reduce 
transportation cost to the basis on the Monongahela River as described in the 
reports of the Chief of Engineers, United States Army, or about 50 to 60 cents 
from Duluth-Superior to Minneapolis, there is no question of a largely in¬ 
creased Minneapolis consumption with a strong resultant stimulus to every 
line of industry and commerce. A water rate of 80 to 90 cents per ton from 
Lake Erie into Minneapolis would be equivalent to moving the Lake Erie coal 
yards, with their millions of tons of coal storage, within a distance of about 
100 miles by rail from Minneapolis. It would largely solve the chief obstacle 
to northwestern industrial development and material progress—namely, the lack 
of coal mines. It would also help the consumer toward the solution of the 
most bitter problem in the matter of high cost of living, to wit, the high price 
of coal. You are perhaps aware that we have more cold weather in the winter¬ 
time in the Northwest than is enjoyed in some other parts of the country—at 
least a higher quality at a lower temperature—and that we can use lots of 
coal in our business. The Pennsylvania coal interests understand this also, 
and we sometimes suspect that they profit by our necessities. We in Minnesota 
grow and produce and make about everything on earth except bananas and 
coal. We can spare the bananas, but we are now using 2,000,000 tons of coal 
in Minneapolis alone and can see our way to use vastly more if your honorable 
Board of Engineers on Rivers and Harbors will help us solve the transportation 
question, which is indeed the major solvent of the burning issue of cheap and 
abundant coal. 

Along with coal from Lake Superior will come iron and steel and cement 
from the new Minnesota Steel Co., a Duluth subsidiary of the United States 
Steel Corporation, which expects to have 4S steel mills, coke ovens, blast 
furnaces, and cement works turning out steel materials and finished products 
at Duluth next season. Minnesota last year shipped 36,000,000 tons-of iron ore 
to Lake Erie for transference to the Ohio and Pittsburgh furnaces and rolling 
mills. Hereafter a substantial share of this iron ore—which is about two- 
thirds of the total American iron-ore production—will be converted into pig, 
steel billets, steel plates, and shapes and sheets by Minnesota labor on Minnesota 
soil. Minneapolis has large foundries, hardware and farm implement shops 
and factories which will use much of the Duluth product. Also a large sub¬ 
sidiary of the United States Steel Co., the American Bridge Co., has extensive 
works in Minneapolis, which will use steel plates, shapes, and pig from the 
Duluth steel mills. All this means a heavy tonnage of iron and steel from 
Duluth to Minneapolis. The Duluth steel plant is located on the Duluth- 
Superior Harbor with extensive dockage facilities only a few miles across the 
harbor from the lake mouth of the proposed canal, while the river terminus 
of the project is Minneapolis, which is likely to be the largest single consumer 
of Duluth steel. The barges which bring the coal, iron, and steel from Duluth- 
Superior to Minneapolis may return with cargoes of limestone from Minneapolis 
stone quarries for the Duluth blast furnaces and cement works; for a ton of 
limestone is needed for each ton of pig, and the banks of the Mississippi at 
Minneapolis consist of limestone ledges. 

Thus Minneapolis is directly interested industrially and commercially in the 
completion and success of the proposed waterway as an important link in its gen¬ 
eral transportation system. In a way the proposed waterway will make Minneapo¬ 
lis the head of Great Lakes commerce, just as it makes Duluth the ultimate head 
of Mississippi River navigation. Opening the channel of commerce between 
lake and river extends the volume of usefulness of both. It creates through 
commerce between lake and gulf and creates a channel of trade between 
North and South, which is an absolute necessity, if the ambitions of your 
Rivers and Harbors Board for the development of commerce on the Mississippi 
and the justification thereby of the huge investment of the Federal Government 
therein shall ever reach fruition. I want to say that my district will do all in 
its power, and that will be no small part, in cooperating with your board to 
develop commerce on the Mississippi River. We believe the day is come when 
the great waterways of our country are required to cooperate with railways, 
as they are so successfully doing in Germany—yes, and on the Monongahela 


96 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER 


and Ohio in our own country—to develop industry and commerce. Even so 
pronounced a railway leader and authority as James J. Hill, of my State, has 
appeared at recent waterway congresses and demanded waterway development 
as the dependence of the Nation in coping with the Nation-wide problem of 
traffic congestion and high living cost. I am not one of those who believe in 
“ pork-barrel ” demands upon the Federal Treasury for local ends; but as the 
Great Lakes and Mississippi are great Federal highways of navigation over 
which only the Federal Government has control, and as there is no legal method 
of securing a much-needed commercial link between these great waterway sys¬ 
tems except by appeal to your honorable board, I support the petition of my 
State and municipality in the case of this project with a clear conscience and 
with confidence that you will give the project your earnest and most thoughtful 
consideration. I hope, at least, that you will vote the project that thorough and 
up-to-date survey which, as I understand, it has not for some years received, 
and that the fullest engineering information and commercial data of your board, 
based on such expert survey, will be submitted by you to the consideration of 
Congress. 

NECESSITY OF WATER TRANSPORTATION TO SECURE JUST RATES FOR THE TWIN CITIES. 

Duluth and Chicago have low-cost water transportation to hold railroad rates 
down to a just and reasonable basis. Minneapolis, St. Paul, Stillwater, and other 
river points, which have no water transportation for east and west business, 
are compelled to accept such rates as the railroads see fit to levy. 

The result is that the Twin Cities and other inland points suffer radically in 
comparative rail rates, as against the rates afforded Duluth and Chicago by 
influence of lake transportation. The law authorizes the Interstate Commerce 
Commission to depart from the principle of parity in adjusting rates whenever 
water transportation competes with rail and makes lower rates for all sections 
bordering on lakes and streams that enjoy low water rates. Against such a 
condition the only remedy is to give water transportation, if practicable, to 
the section suffering from high and discriminating rail rates. 

How this condition has worked against the Twin Cities in favor of Chicago 
and Duluth is a matter of history. Take the comparative rates on first-class 
merchandise as an illustration of the workings of this principle and of the 
practices of the railroads in taking advantage of their opportunity to tax all 
the traffic will bear. 

In 1892 the rate on first-class merchandise from New York to the Twin 
Cities was only 5 cents per hundred over the rate to Duluth. In 1896 it was 
14 cents. From 1901 to 1907 it was 15 cents. In 1913 the differential in favor 
of Duluth was raised to 21 cents. In 1914 the differential was raised to 28 
cents. Finally, on March 25, 1914, the four railroads running between Duluth 
and the Twin Cities issued new tariffs raising the local rate from Duluth to 
the Twin Cities to 41.4 cents on first-class merchandise. On the other mer¬ 
chandise classes there has been a similar percentage in the growth of the dif¬ 
ferential against the Twin Cities in favor of Duluth. The differential on 
fifth class advanced against the Twin Cities from 2 cents in 1892 to 7 cents in 
1913, and the local roads now propose as the Duluth-Twin City rate 20.7 cents 
per hundred. 

The rate from New York to the Twin Cities has been advanced not only com¬ 
paratively as against Chicago and Duluth, but actually. The first-class rate 
from New York to the Twin Cities advanced from 75 cents in 1901 to 83 cents in 
1907, and it is now demanded to jump the rate for 1914 to $1.03. 

Against such discrimination there is only one remedy, and that is to extend 
the benefits of water transportation via the Lake Superior-Mississippi waterway 
to the Twin Cities. Such waterway extension will benefit not only the Twin 
Cities but the entire country tributary. The lower transportation costs which 
the proposed project will produce will have a widespread effect in lowering the 
Whole basis of railroad tariffs for the great industrial empire of which the Twin 
Cities are the chief distributing center. 

How widespread may be the benefits, for example, of rate reductions to my 
own district of Minneapolis you will readily perceive in connection with the 
fact that Minneapolis is the world’s leading primary wheat market, leading 
primary market for flaxseed, the leading distributing point for agricultural 
implements, and the greatest flour milling center. Reduced rates on such staples 
from Minneapolis to the Great Lakes benefits the producers of at least four 
tributary States. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 97 


RESOLUTION ADOPTED BY THE BOARD OF DIRECTORS OF THE ST. PAUL ASSOCIATION 
OF COMMERCE AT A MEETING HELD WEDNESDAY, JUNE 3, 1914. 

Whereas there has been under consideration by the Government of the United 
States for a number of years the practicability of the construction of a barge 
canal connecting Lake Superior and the Mississippi River by way of the St. 
Croix River; and 

Whereas several examinations of the most feasible route for such a canal have 
been made under the direction of the War Department, with the result that 
the route via the Brule and St. Croix Rivers has been determined by each 
of such reports to he engineeringly feasible and practicable, and that the cost 
of such canal is estimated at $7,815,000; and 
Whereas the commercial interests of the city of St. Paul, as represented 
formerly by the St. Paul Jobbers and Manufacturers’ Association and latterly 
by the St. Paul Association of Commerce, have always favored the construc¬ 
tion of said canal: Now, therefore, be it 

Resolved by the 87. Paul Association of Commerce, That it does hereby re¬ 
iterate its approval of the construction of the said projected canal from Lake 
Superior to the Mississippi River, as described above, and does hereby direct 
the president to appoint a representative to appear before the General Board 
of the United States Army Engineers, at the hearing upon the appeal from the 
report of the local board of engineers, at Washington, D. C., on June 30, 1914, 
and on behalf of this association submit to such board such statistics, state¬ 
ments, and arguments in favor of the construction of said canal as may be 
appropriate, and to take such further steps as may be necessary to promote the 
construction of said canal; and be it further 

Resolved , That a copy of these resolutions be forwarded to the Hon. Knute 
Nelson and the Hon. Moses E. Clapp, Senators, and to Hon. Fred C. Stevens, 
Representative in Congress from the fourth district, and to Hon. Geo. R. Smith, 
Representative in Congress from the fifth district of the State of Minnesota, 
requesting them to take such action as in their judgment will best promote the 
construction of said canal by the United States Government. 

[ SEAL. ] 


Appeal of Minnesota and Wisconsin Canal Commissions to the Board of 
Engineers for Rivers and Harbors, Washington, D. C., in the. Matter of 
Lake Superior-Mississippi Canal—General Data and Argument for Con¬ 
struction of Canal. 

(June 13, 1914.) 

[George H. Sullivan, Stillwater, Minn., counsel for Minnesota Canal Commission ; E. F. 
Ackley, - Chippewa Falls, Wis., counsel for Wisconsin Commission.] 

PROJECTED CANAL FROM LAKE SUPERIOR TO MISSISSIPPI RIVER 
VIA BRULE AND ST. CROIX RIVERS. 

Appeal of Lake Superior and Mississippi Canal Commission of the State of 
Minnesota from the report of the local board of United States Army Engi¬ 
neers at Duluth, Minn., dated May 14, 1913, reporting that the proposed 
canal is not now commercially feasible and practicable. 

The Board of Engineers for Rivers and Harbors, 

Washington, D. C.: 

The Lake Superior and Mississippi Canal Commission of the State of Minne¬ 
sota having heretofore duly appealed in writing from the report of the local 
board of United States engineers at Duluth, dated May 14, 1913, in and by 
which report it was determined by said local board of engineers that the pro¬ 
posed canal from Lake Superior to the Mississippi River via the Brule and 
St. Croix Rivers is not now feasible or practicable, submits the following 
statements, data, and statistics, with the request that upon due consideration 
thereof said report of said board of engineers at Duluth be not concurred in 
by the Board of Engineers for Rivers and Harbors. The Lake Superior and 
Mississippi Canal Commission of the State of Wisconsin joins with the Canal 
Commission of the State of Minnesota in the submission of this statement and 
in the request that the report of the local board be not concurred in, and like 


H. Doc. 1008, 64-1-7 




98 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


request is also made by and on behalf of the Association of Commerce of the 
city of Minneapolis, the Association of Commerce of the city of St. Paul, and 
also all other cities, municipalities, representative commercial bodies and 
citizens of the upper Mississippi Valley and the Northwest who appeared before 
or who addressed communications to the local board of engineers in favor of 
the project. 

For resolutions of Minnesota and Wisconsin Legislatures creating canal com¬ 
missions of such States see Exhibits 14 and 15. 

DESCRIPTION AND OUTLINE OF PROJECTED CANAL. 

1. The project under consideration is the construction of a canal from Allouez 
Bay, which is a part of the Duluth-Superioi Harbor on Lake Superior, to the 
mouth of the St. Croix. 

Distance from the mouth of St. Croix to the Allouez Bay, the Superior end 
of the canal, 210 miles. 

Distance from mouth of St. Croix on Mississippi River to St. Paul, 27 miles; 
to Minneapolis, 40 miles; and to various Mississippi ports and terminals. 

Open-river navigation from Taylors Falls on the St. Croix to Minneapolis, on 
the Mississippi, 92 miles. 

Canalized section from Duluth-Superior Harbor to Taylors Falls, 160 miles. 

Minneapolis to end of canal, Allouez Bay, 250 miles. 

Elevation of summit level above Lake Superior, 411 feet. 

Elevation of summit level above Mississippi at mouth of St. Croix River, 
344 feet. 

Locks and dams: Sixteen locks 170 by 35 feet and eight hydraulic lifts, 6 
feet low-water depth on miter sills. 

Waterpowers: Engineers estimate 21,000 horsepower on Brule and St. Croix, 
not including 15,000 to 18,000 horsepower on partially completed High Dam on 
Mississippi between St. Paul and Minneapolis; other estimates by citizen 
engineers up to 50,000 horsepower. 

Cost of project (not including hydroelectric development), $7,815,000. 

Cost for operation, maintenance, and 3^ per cent interest on investment, 
$420,000 per annum. 

LENGTH OF CANAL. 

2. The length of the canal from Lake Superior is given in the report of the 
local board as 222 miles from the Duluth Canal to the mouth of the St. Croix 
River. This is an error. The distance should be calculated from the junction 
of the canal with Allouez Bay, which is a part of the Duluth-Superior Harbor, 
and which point is the northern terminus of the canal. This is clearly stated 
in the reports of the United States Army engineers, House Document No. 204, 
Sixty-first Congress, second session, pages 4-7. This makes the distance from 
the city of Minneapolis via the Mississippi River, St. Croix River, and the 
northern terminus of the canal 250 miles instead of 262 miles. 

PROPOSED CANAL EN GINEERIN GI.Y FEASIBLE TO CONSTRUCT AND OPERATE. 

3. That it is entirely feasible and practicable to construct, maintain, and 
operate the proposed canal is thoroughly demonstrated by the several reports 
made by United States Army engineers who have made several examinations 
and surveys of the route pursuant to congressional action. The details of 
such examinations and surveys, together with data and statistics as to the 
cost of construction, maintenance, and operation, will be found in the following 
reports: 

August 30, 1909, report of Lieut. Col. Graham D. Fitch, Corps of Engineers, 
of preliminary examination in compliance with river and harbor act of March 
3, 1909. (H. Doc. No. 304. 61st Cong., 2d sess.) 

June 14, 1899, report of Maj. Clinton B. Sears, Corps of Engineers, in com¬ 
pliance with river and harbor act of March 3, 1899. (H. Doc. No. 59, 56th Cong., 
1st sess.) 

March 10, 1896, report of Maj. Sears with detailed report by Asst. Engineer 
John Krey. (H. Doc. No. 330, 54th Cong., 1st sess., pp. 2390-2454 of Annual 
Report of Chief of Engineers, 3S96.) 

Each of the foregoing reports finds the projected canal feasible and prac¬ 
ticable to construct; that a 6-foot canal can be constructed and operated. 

Cost of construction, $7,815,000. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 99 


Cost of operation and maintenance and 31 per cent interest on the investment 
of the Government, $420,000 per annum. 

No Government or other engineer lias ever reported that the canal is not 
practicable from an engineering standpoint. 

COMMERCIAL FEASIBILITY OF CANAL. 

4. The only question in issue is the commercial expediency or feasibility of 
the canal, or as stated by the local board at section 30 of the report: 

“ Will the saving in freight to the public on the probable commerce through 
the canal be equal to the $420,000 annual expense to the Government for opera¬ 
tion, maintenance, and interest on the investment?” 

In other words, Can the canal compete with the four lines of existing rail¬ 
ways from Duluth-Superior to the Twin Cities and effect a saving of $420,000 
per year to the public? 


IMPORTANCE OF THE SUBJECT. 

5. It is elementary that the cost of all transportation in the last analysis 
is borne by the consumer and is a tax from which none can escape. The 
greatest tax borne by the individual citizen of the United States is the tax 
paid for railroad transportation in the form of railway freight. For the year 
190G-7 the total gross revenue of the railways of the United States was 
$2,875,689,500, or about $30.86 per capita, or a tax of $154.30 per annum for* 
each family of live persons. 

In the same year the average amount per capita collected by the Govern¬ 
ment of the United States in tariff duties on imported goods was $3.84. So the 
railway transportation tax was more than eight times as great as the tariff 
tax. During the same year the average receipts of the United States Govern¬ 
ment from all sources was $9.84 per capita. 

In the nature of things it is impossible for the individual to know or ascer¬ 
tain how much he pays for transportation tax or tariff tax. He is paying a 
slight amount of each form of such whenever he buys any article which lias 
been transported by railway or affected directly or indirectly by the tariff. 
However, he usually remembers the amount lie pays directly in the city, county, 
or State taxes, and has a receipt to refresh his memory thereof. In the 
year 1902 the total revenues and taxes paid to all the States, counties, cities, 
towns, villages, districts, and all other political subdivisions in the whole United 
States, added to the total revenues of the United States Government for that 
year, amounted to $1,791,895,522. 

For the same year the gross earnings of railways amounted to $1,922,703,896, 
showing that the transportation taxes paid to railways in that year exceeded 
all other taxes paid for all public purposes in the United States by the enormous 
sum of $130,80S,374. 

The bureau of railway news and statistics of the United States records a 
railway freight movement for the year ending June 30, 1913, of 300,000,000,000 
ton-miles at an average rate of 7.27 mills per ton-mile, or total freight bill of 
$2 181 000,000. The same authority gives total gross railway revenue for the 
vear 1913 as more than $3,000,000,000. 

While the tax exacted from the consumer may be estimated as above at 
$30.84 per capita, it is utterly impossible to even approximate the total toll or 
amount per capita exacted from the producer whose products are diminished 
in selling price by deductions made for freight from place of production to 
consumption. However, the above considerations clearly indicate the immense 
tax upon producer and consumer occasioned by railway transportation. It 
would, therefore, seem to be of the highest importance that every possible 
means’ available be resorted to which will result in lessening this enormous 
railway transportation tax which bears so heavily upon each individual citizen. 

CANAL OR WATERWAY V. RAILWAY TRANSPORTATION. 

6. Authorities on transportation, as we understand it, agree to the proposi¬ 
tion that it requires very much less power to move the same amount or weight 
of freight upon a waterway or canal than by any other method of transporta¬ 
tion. The equivalent of a horsepower can move 2 tons at the rate of three 
miles per hour on a fairly level wagon road, 15 tons in a car on a railway, and 
90 to 100 tons in a boat' of proper shape oil a waterway of width and depth 


100 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


adapted to its use. The average rate received by railways in the United States 
in 1907 was 7.82 mills per ton-mile; in 1913, 7.27 mills per ton-mile. 1 

RAILWAY RATES TEND TO INCREASE. 

7. Current history clearly indicates that the tendency of railway rates is to 
increase rather than decrease. By elimination of grades, increase in efficiency, 
and capacity of equipment of locomotives, improvements in terminals, and 
other economies effected by railways in recent years, it would seem that the 
minimum cost of railway transportation was reached last year. Through every 
part of the country railways are insistently clamoring for an increase in rates. 
They cite figures and statistics indicating their inabilty to operate railways 
at present rates without loss such as they claim will result in inefficient service 
or ultimate bankruptcy. They assert that it is impossible to raise capital to 
make needed extensions and improvements, so that it may well be assumed 
that the outlook is for increased rather than decreased railway rates. 
(Final Report National Waterways Commission, page 575.) There are 
pending applications of railways to raise the rates between the Twin Cities 
and Duluth and also an application to raise lake and rail rates from Twin 
Cities to eastern points. There are pending before the Interstate Commerce 
Commission applications of the railways of the country for a horizontal increase 
in rates of 5 per cent. A horizontal raise of 5 per cent would add to the freight 
railway tax to be paid by the public the enormous sum of $109,050,000 annually. 

♦As indicated hereafter, that amount and more could be saved to the public 
by removing the railway shackles from water-borne commerce, permitting 
waterways to perform their natural function of carrying freight which should 
be carried on water at a saving to the public. 

8. The average rate for bulk freight on the Great Lakes is eight-tenths of a 
mill per ton-mile. It is estimated by Army engineers that when the improve¬ 
ments on the Ohio River are finished transportation can be conducted thereon 
for one-half a mill per ton-mile. On the old Erie Canal, under conditions de¬ 
cidedly unfavorable to low cost, such as old-type wooden boats of small tonnage 
capacity, antiquated towing methods, absence of adequate terminals and modern 
machinery for loading and unloading, railway discriminations against and 
practically boycotting of canal freight, the rate was 2 mills per ton-mile. On 
the new Erie Canal, with modern terminals and terminal facilities, controlled 
by the State, with canal traffic protected by the State and United States, reliable 
authorities estimate the cost per ton-mile will not exceed from one-half to 1 mill. 
Rates on waterways where the most modern type of boat is used, with adequate 
terminals and machinery for loading and unloading, by consensu; of all trans¬ 
portation authority in the United States and Europe, ought not to exceed from 
one-lialf a mill to 2 mills per ton-mile. 

It is in the nature of the case that water transportation is less costly and 
more economical than railway transportation, unless unnatural and artificial 
obstacles prevent the use of the waterways under favorable conditions. The ex¬ 
pense of equipping a transportation line, at least so far as the boats are con¬ 
cerned, is but trivial in comparison with that of constructing a railway. 
Waterways cost less to maintain; have almost unlimited capacity, and hence 
are not liable to congestion, and frequently deliver freight more rapidly than 
railways. Waterway transportation has a decided advantage in that the 
waters are free, and anyone having the requisite capital and ability can engage 
in the business. This tends to create competition and to prevent monopoly. In¬ 
deed, it may be asserted, as a general proposition, that in any highly advanced 
country it is extremely desirable that means be afforded for the carriage of 
freight not only by rail but by water as well. It is a matter of common occur¬ 
rence that in years of great crops or unusual prosperity the railways of the 
country have been unable to provide for the prompt and efficient performance 
of their duties as common carriers. Stagnation and congestion of traffic occur, 
entailing enormous losses. The existence of this condition affords an inde¬ 
pendent argument for the development of transportation routes by water, even 
in localities where shippers mainly depend upon railways. 


1 For table of comparison of rail rates in United States and water rates in Europe, 
showing water rates much lower than rail, see Exhibit 11, Final Report National Water¬ 
ways Commission, p. 568. 




WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 101 


RErORT OF LOCAL BOARD FOUNDED UTON ARTIFICIAL AND PREVENTABLE OBSTACLES. 

9. The report of the local board does not find that transportation by canal 
is economically inferior to railway transportation, nor that canal transporta¬ 
tion is not cheaper than railway transportation, blit finds in effect that canal 
transportation will be hampered and prevented by existing artificial, unnatural, 
and wholly unnecessary obstacles, mainly the result of railway hostility and 
the manipulation of agencies controlled by railway ownership of terminals, 
terminal facilities, and general control of freight at points or origin and desti¬ 
nation; railway discriminations against water-borne traffic and practices, 
amounting practically to boycotting water traffic. It is because of the artificial, 
unnecessary, and preventable obstacles found to exist by the local board that 
they report the canal to be not commercially feasible. These obstacles the 
local board assumes will continue to exist, but we think it is demonstrated 
herein that all of the obstacles to water transportation may and will be pre¬ 
vented or swept aside. 

ECONOMIC LOSS TO PUBLIC AND CONSUMER BY REASON OF RAILWAYS DIVERTING 

FREIGHT FROM WATER TO RAIL WHICH COULD BE CARRIED CHEAPER BY WATER. 

10. It will be conclusively shown herein that a large percentage of freight, 
which could be transported by water at less cost than by rail, is diverted to 
rail by the indefensible boycotting of water traffic resorted to by railways. 
The resulting loss of the difference in cost between water and rail transporta¬ 
tion is borne by the consuming public. The railway makes up any loss occa¬ 
sioned by water competition from higher freight charges to other points not 
affected by water competition, but the public pays the whole railway freight 
bill. 

If the amount of freight so diverted from water to rail be only 15 per cent 
of the total railway freight paid in 1913, it would be $327,150,000 annually. 
If the difference in cost between rail and water transportation be only 33 
per cent the loss to the public by reason of such unnatural diversion from water 
to rail amounts to the enormous sum of $109,050,000 per annum. 

If the railways would permit or be required to allow freight to go by water 
which can and would naturally be transported by water cheaper than by rail, 
it is quite possible there would be no necessity of increasing present railway 
rates. 

FINDINGS AND CONCLUSIONS OF LOCAL BOARD. 

11. The local board of engineers arrive at the conclusion that the proposed 
canal is not commercially feasible by the following findings, statements, reason¬ 
ing, and conclusions, which may be grouped as follows: 

DECADENCE OF INLAND WATERWAYS AND CANALS. 

A. The board calls attention to the general decline in inland waterway and 
canal traffic. They point to the decline of traffic on the Erie Canal from 
4,608,581 tons carried in 1880, being 18 per cent of the total freight moved 
by rail and canal between Buffalo and New York, to 2,385,491 tons in the 
year 1906, an actual decrease in freight of nearly 50 per cent and a decrease 
in total freight carried between Buffalo and New York from 18 per cent to 
3 per cent. They quote figures purporting to show a decline of traffic on the 
upper Mississippi River of 85 per cent from 1889 to 1906. They also quote 
figures showing decline of traffic on the Ohio River, lower Mississippi, Mis¬ 
souri, and Illinois Rivers, and say that in 1909, 4,500 miles of canals had been 
constructed in the United States, of which 2,444 miles, costing $80,000,000, had 
been abandoned, and at section 112 say that the ultimate fate of the proposed 
canal, if constructed, would only add to the figures of abandoned canals. The 
only inference possible to draw from the statements of the local board with 
reference to inland waterways on canals and rivers is that traffic thereon is no 
longer profitable or practicable; that it is dying out and that inland water¬ 
way projects are unworthy of improvement or of assistance from the General 
Government or any source and consequently railway transportation is better, 
cheaper, and to be preferred to inland waterway transportation. 


102 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

In passing we note that in citing figures showing decline of traffic on the 
upper Mississippi River the local board (sec. 43) gives the figures of the ton¬ 
nage as follows: 


1889_ 3,947,364 

1906___ 595, 885 


The United States Army engineer’s office at Rock Island, in response to an 
inquiry made by the Minnesota commission, in a letter addressed to George H. 
Sullivan, dated April 16, 1914, gives the following figures showing details and 
total tonnage on upper Mississippi River for the years 1889 and 1906, as follows: 


Tons. 

1S89—Logs and lumber_ 3, 760, 389 

Miscellaneous freight_ 320, 743 

United States material_ 485,438 


4, 566, 579 


1906—Logs and lumber_ 2, 630,141 

Miscellaneous freight_ 1, 001, 867 

United States material_ 215, 311 


3, 847, 319 

These figures show a decline in total traffic of 719,260 tons, or 15 per cent, 
instead of a decline of 3,351,479 tons, or 85 per cent, as stated in section 43 of 
the report of the local board. 

The decline in the item of logs and lumber is 1,130,257 tons, or 24 per cent. 

It is well known that shipments of logs and lumber have declined because of 
extinction of the pine forests of Minnesota and Wisconsin. 

But it appears that there was an actual increase in all other freight on the 
upper Mississippi during the period in question: In 1889, miscellaneous freight 
and United States material, 806,181 tons, to 1906, miscellaneous freight and 
United States material, 1,217,178 tons, or an increase of practically 50 per cent. 

HANDLING AND TERMINAL CHARGES AND RAILWAY HOSTILITY TO WATERWAYS AND 

CANALS. 

B. With reference to this particular project the local board finds certain ter¬ 
minal charges, such as 25 cents per ton for loading coal upon and 25 cents for 
unloading coal from canal barges; 25 cents per ton deterioration in value of 
coal due to one extra handling by clam shell over rail transportation; 25 cents 
for delivery from canal dock to carload consumer; certain elevator charges for 
loading and unloading grain; and the existence of certain terminal, dock, and 
storage charges upon freight and general merchandise which prevent freight 
from being transported upon the canal at as low a rate as it may be carried 
upon existing railways. In this connection the board also find as reasons why 
the canal can not carry general merchandise or package freight, including salt, 
sugar, groceries, cotton and woolen goods, etc., that lake vessels are owned by 
railway companies and therefore will not deliver freight to or accept freight 
from canal boats or barges, except at local or higher rates than when such 
freight is delivered to or received from railway lines. That the canal carriers 
will be deprived of all freight known as lake-and-rail freight, i. e., freight origi¬ 
nating upon railways either at eastern or western points, a part of the carriage 
of which is by rail and part by lake, on account of discrimination against canal 
freight by railways. 

It is found in effect that through their control and ownership of terminals, 
docks, and storage warehouses at Duluth, Superior, Buffalo, and other lake 
harbors, ownership of lake vessels, canal terminals, and boats on the Erie Canal, 
agreements between eastern and western railways and other agreements be¬ 
tween railways, such railways can and will divert all traffic to rail and lake 
lines under common control of railways. That ownership by railways of ter¬ 
minals permits them to make a through rate for the entire carriage from the 
point of origin of freight to its destination, including the terminal charges, stor¬ 
age charges, dock charges, loading and unloading charges, so that the rate for 
delivery of freight from origin to destination, including all charges, is lower 
than it is possible to transport the freight through an independent agency such 














WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 103 


as the proposed canal, transporting the freight only at one end or upon one por¬ 
tion of the entire route, and being subject to terminal charges and other ex¬ 
actions controlled through railway influences in the manner described so as to 
effect any saving of freight at all when such charges are added and a local or 
higher rate exacted by the railways and lake carriers controlled by railways 
transporting such freight for the remainder of the distance. While it is clear 
that freight transported by canal from Duluth-Superior to the Twin Cities 
originating at eastern points or freight originating at the Twin Cities, or 
tr hutary thereto, transported over the canal destined for eastern points, only 
requires one extra handling, that is, on westbound freight, the extra handling 
from lake carrier to canal boat, and on eastbound freight the extra handling 
from railway car to canal boat of that portion not loaded directly from mill dock 
or elevator to canal boat, yet the terminal charges for loading and unloading as¬ 
sumed in the report seem to the local board sufficient to deprive the canal of all 
freight. Such charges, in fact, are cited by the local board as demonstrating 
that freight will not and can not move over the projected canal except at a 
greater rate than such freight is now moved by rail or by existing lake and 
rail rates. In effect it is also found that the refusal of railways to make 
joint and other rates or to divide traffic upon the basis upon which lake carriers 
and railways which control such lake carriers now divide the same, or upon 
any equitable basis, is found as one of the insurmountable obstacles to the suc¬ 
cess of the projected canal. 

In other words, the hostility of existing railway lines to water traffic and 
the various methods by which railways have in the past destroyed inland water¬ 
ways and canal traffic, including traffic upon all of the rivers and canals whoSfe 
traffic has been partially or wholly destroyed, according to the report of the 
local board are found and assumed as conditions that will continue as insur¬ 
mountable obstacles to freight traffic upon the waterways and canals of the 
whole country and of such a character as to absolutely prohibit the proposed 
canal from receiving or transporting any freight whatsoever. 

TOTAL TONNAGE AVAILABLE TO CANAL. 

C. The board finds the total bulk freight or tonnage available for transpor¬ 
tation on the proposed canal and of the character usually transported by canal, 
such as coal, iron, steel, general merchandise, flour, grain, etc., to be 3,295,000 
tons. This tonnage is calculated on the basis of the tonnage actually carried 
by railways between the Twin Cities and Duluth-Superior for the year ending 


•Tune, 1912, as follows: 

Tons. 

Hard and soft coal and iron_ 1, 954, 5G8 

Flour _ 223,170 


The railroads in question estimate the foregoing figures for hard and soft 
coal and iron constitute 80 per cent of the bulk tonnage moving south. The 
board then find the additional local population of the canal zone amounts to 22 
per cent of the population of the termini and hence add 22 per cent to the 
actual coal shipments of 1912 and 12£ per cent to the flour tonnage; then as¬ 
suming the result to be 80 per cent of the total bulk freight moved between 
the Twin Cities and Duluth-Superior, find the total bulk shipments for the year 
1912, allowing the above increases of 22 per cent for coal and 12 \ per cent for 
flour for the local consumption of the canal zone, as follows: 



Tons. 

Percentage 
of all. 

Soft coal. 

1,724,000 
658,200 

52.3 

Hard coal. 

20.0 

Iron and steel. . 

2,400 
251,400 

.1 


7.6 


329,500 

10.0 

General merchandise. 

329,500 

10.0 


Total. 

3,295,000 

100.0 



The figures and percentages so arrived at are assumed by the board as the 
total tonnage tributary to the canal. 

















104 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


We do not agree that the figures or results or that the method of such com¬ 
putation is correct nor that the question should turn upon the tonnage of 1912. 
We think the coal tonnage and bulk shipments are largely in excess of the 
amount estimated by Ihe board for the year 1912. 

We note that while the total shipments of hard and soft coal for 1912, after 
adding 22 per cent for increased consumption in Canal Zone, are found to he—• 


Soft coal_ 
Hard coal 


Tons. 

1, 724, 000 
658,200 


Total_ 2, 382, 200 

Yet at section 69 the local hoard says actual shipments of coal from Duluth to 
Twin Cities and Minnesota Transfer for 1912 are stated to he— 

Tons. 

Hard coal_ 1, 724, 000 

Soft coal_ 658, 200 


Total_ 2,382,200 

Adding 22 per cent to the actual shipments, according to method of local 
hoard, increases the available coal tonnage for 1912 524,084 tons, or a total of 
2,906,284. 

We reproduce statement received from Minnesota Railway and Warehouse 
Commission in April, 1914, of total tonnage actually shipped by railways from 
head of Lakes to Twin Cities for years ending June 30, 1909, 1910, 1911, 1912, 
and 1913: 



North¬ 

bound. 

South¬ 

bound. 

Total. 

1909. 

Northern Pacific Ry. 

368,507 
113,168 
238,274 

813,780 
324, 773 
555,507 

1,182,287 
467, 941 
793, 781 

Chicago, St. Paul, Minneapolis & Omaha Ry. 

Great Northern Ry. 

Total. 

747,929 

1,694,060 

2,444,009 

1910. 

Northern Pacific Ry. 

433, 940 
137,867 
261,640 

946,872 
379,759 
598,202 

1,380,812 
517,626 
859,842 

Chicago, St. Paul, Minneapolis & Omaha Ry. 

Great Northern Ry. 

Total. 

833,447 

1,924,833 

2,758,280 

1911. 

Northern Pacific Ry. 

466,166 
137,213 
271,039 

1,097, 676 
417,137 
722,835 

1,543,842 
554,350 
993,874 

Chicago, St. Paul, Minneapolis & Omaha Ry. 

Great Northern Ry. 

Total. 

854,418 

2,237,648 

3,092,066 

1912. 

Northern Pacific Ry. 

445,360 
77,676 
230,406 

1,447,840 
438,487 
844,394 

1,893,200 
516,163 
1,074,800 

Chicago, St. Paul, Minneapolis & Omaha Ry. 

Great Northern Ry. 

Total. 

753,442 

2,730, 721 

3,484,163 

1913. 

Northern Pacific Ry. 

663,480 
202, 784 
47,815 
282,885 

1,637,264 
371,823 
169,342 
714,891 

2,300, 744 
474,607 
217,157 
997,776 

Chicago, St. Paul, Minneapolis & Omaha Ry. 

Soo Line 1 . 

Great Northern Ry. 

Total. 

1,096,964 

2,893,320 

3,990,284 



1 From July 15, 1912, to June 30, 1913. 


This shows increase in total shipments in four years from 2,444,009 tons to 
3,990.284 tons, or 63 per cent, or more than 15 per cent per annum. It shows 
total shipments 1912 of 3,484,163 tons. It shows that the Soo line management 
did not consider railway competition between head of Lakes and Twin Cities as 
any sufficient bar to the building of a new line of railway in 1913. We insist 

















































WATERWAY FROM LAKE-SUPERIOR TO MISSISSIPPI RIVER. 105 


that the total tonnage available for the canal should he determined not on the 
basis of 1912 but on the basis of what it will be at the time of the completion 
of the canal, say 1920. The annual increase for the four-year period prior to 
1912 being more than 15 per cent, in 1920 it should be more than 120 per cent 
over the 1912 figures. This would more than double all the figures of the local 
board and would give an available coal tonnage of approximately 5,000,000 tons 
and other tonnage in proportion. 

AVERAGE FREIGHT RATE ON PROPOSED CANAL. 

D. The local board estimates the freight rate on the proposed canal would be 
the same as the freight rate on the Erie Canal, which the board finds to be 3 
mills per ton-mile, and taking the distance at 260 miles finds the average canal 
rate will be 78 cents per ton. As shown later herein this rate should not exceed 
2 mills per ton-mile, or 50 cents per ton. 


EXISTING RAIL RATES BETWEEN DULUTH-SUPERIOR AND ST. PAUL AND MINNEAPOLIS. 

E. The board finds existing rail rates between Duluth-Superior and St. Paul 
and Minneapolis, January, 1913, as follows: 


Coal, hard'_$1.25 

Coal, soft_ . 90 

Wheat_ 1. 00 

Flour 1 _ 1.00 

Coarse grain_ 1. 00 

Lumber_ 1. 20 

Structural iron_ 1. 50 

Building stone_ 1. 00 

Iron castings_ 2. 00 

Cement_ 1.00 


Iron, bar or band_$1. 50 

Iron, pig_ 1.12 

Lime_ 1. 20 

Rails_ .90 

Salt_ 1.00 

Sand_ 1. 00 

Stone_ 1. 00 

Stone, crushed_ . 80 

Sugar_ 1. 60 


LOCAL BOARD THEN DETERMINED AVERAGE RAILROAD RATES ON ALL COMMODITIES. 

F. “The average rail rate for iron may be taken as the average rate on the 
five kinds, or $1.40. The general merchandise rate may be taken as the average 
on stone, cement, lime, salt and sugar, or $1.16. The average rate on all freight 
may thus be determined: 



Tons. 

Rate. 

Amount. 

Soft coal. 

1,724,000 
658,200 
2,400 
251,400 
329,500 
329,500 

$0.90 

1.25 

1.40 

1.00 

1.00 

1.16 

$1,551,600 
822,750 
33,600 
251,400 
329,500 
382,220 

Hard coal. 

Iron and steel. 

Flour. 

Grain. 

General merchandise. 

Total. . . 

3,295,000 


3,371,070 




IwHmy—$1- 024, the average rail rate on all commodities.” 


In determining this rate the board multiplies the number of tons of each 
commodity shipped in 1912 by the rate on such commodity and after adding 
the amounts together divide the total by the number of tons, and thus find an 
average rate of $1,024. In passing we note the general merchandise rate is 
taken as the average rate on stone, cement, lime, salt, and sugar; but there 
is no such computation of the amount of the several commodities included 
in general merchandise, in reaching the average stated, such as is used with 
reference to all the other commodities. But the rate per ton for each of the 
several commodities included under the term “ general merchandise ” are added 
together and divided by one number of such commodities instead of the total 
amount shipped. This method is obviously improper and the result inaccurate 
because not based upon proper data or computations. Sugar takes a rate of 
$1.60 a ton and is one of the largest items in the list. 


* One road charges $1.50. 









































106 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


AMOUNT OF FREIGHT CANAL MUST TRANSPORT TO BE COMMERCIALLY FEASIBLE. 

G. The local board says: “ If the average canal rate of 78 cents be sub¬ 
tracted from the average rail rate, $1,024, it leaves $0,244 as the difference 
which goes to reimburse the United States for its canal expenditure.” The 
board therefore finds that the canal must haul annually 1,647,500 tons, or 50 
per cent of the estimated traffic for the fiscal year 1912, at a saving of $0,244 
per ton in order to be commercially feasible. To the claim that the total 
freight will increase from year to year the board points to the history of 
the Erie Canal and other waterways as showing there will be no increase in 
canal traffic, but, on the contrary, a diminution or loss therein. The board 
says that a reduction of 10 cents per ton in freight will not secure the traffic 
for the canal because the service on the railroads is better and quicker. 


BOARD FINDS CANAL WILL NOT CARRY COAL OR ANY COMMODITY OR FREIGHT 

WHATSOEVER. 


H. The board then takes up the several commodities usually carried on 
canals, such as coal, iron, steel, grain, flour, etc., upon the authority of Julius 
Barnes, Messrs. Little and Hall, and the authorities quoted in the report, 
and proceeds item by item to find that no commodity or freight whatever can 
be carried on the canal at any saving whatever below existing railway rates. 
In fact, the board finds that when the extra handling, loading, and unload¬ 
ing charges occasioned by the use of canal boats as a means of transportation 
are considered, that no commodity whatsoever could be transported on the 
canal without losses as follows: 


Losses on canal transportation. 


Soft coal_ 

Hard coal_ 

General merchandise 

Grain_ 

Flour_ 


Cents per 
ton. 

73 

3 

12 

_ 131-41 

11 


And these losses all without any account being taken of the loss to the 
United States or cost of maintenance, operation, and 31 per cent on the in¬ 
vestment equaling $420,000 a year, or 25 cents per ton on 1,647,500 tons. 


LOSSES FOUND BY LOCAL BOARD WHOLLY DUE TO TERMINAL CHARGES, COST OF 
LOADING AND UNLOADING, RAILWAY DISCRIMINATING AGAINST WATER FREIGHT, 
AND REFUSAL OF RAILWAYS AND LAKE CARRIERS TO MAKE THROUGH JOINT RATES. 


I. It will be noticed that the average canal rate is found by the board to be 
78 cents and the average rail rate at $1,024. Therefore it is clearly seen 
that the losses in canal transportation by the board are due, as stated in 
the report of the local board, to terminal charges or charges for one extra 
handling of the various commodities involved in the shipment by canal which 
is not involved in shipment by rail, to hostility of railways to waterways, and 
control of terminals and terminal charges by such railways. These extra 
charges against canal transportation and which, according to the findings of 
the local board make it not commercially feasible, are summarized in the 
report (sec. 89) as follows: 

“ (a) Soft coal .—Canal rate, 78 cents; unloading at St. Paul or Minneapolis, 
25 cents; breakage in unloading, 25 cents; 50 per cent transferred to another 
yard, at least 10 cents; making same delivery that railroad makes, 25 cents; 
total, $1.63. Rail rate on soft coal, 90 cents. Loss, 73 cents per ton. 

“ (b) Hard coal .—Canal rate, 78 cents; unloading at St. Paul, 25 cents; de¬ 
livery in St. Paul, 25 cents; total, $1.28. It will be noted that the anthracite 
coal is charged nothing for breakage or extra handling to another large yard. 
Rail rate on hard coal, $1.25. Loss, 3 cents per ton. 

“ (c) Iron and steel ,—Canal rate, 78 cents; unloading in St. Paul (same as 
coal, which is more easily handled), 25 cents; delivery (same as for coal), 
25 cents; total, $1.28. Storage in Duluth-Superior lost. Listed rail rate, $1.40 
(actual much less). Gain, 12 cents per ton. 







WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 107 

“ (d) General merchandise. —Exactly the same throughout as iron and steel— 
$1.28. (Storage in Duluth-Superior lost.) Listed rail rate, $1.16 (actual much 
less). Loss, 12 cents per ton. 

“ (e) Grain. —Canal rate, 78 cents; elevator charges in Twin Cities, 27 cents 
per ton (three-fourths cent per bushel, average weight of grain shipped Duluth- 
Superior 55.6 pounds per bushel, or 36 bushels to the ton) ; elevator charges in 
Duluth-Superior (1 cent per bushel), 36 cents; total, $1.41 per ton. Railroad 
rate on grain, $1 for 90 per cent and 50 cents for 10 per cent, or an average of 
95 cents. Assume that one-half the wheat passing through Minneapolis would 
pay elevator charges even if sent forward by rail, 13.5 cents; average elevator 
charges in Duluth-Superior, 36 cents; total, $1,445. Gain, 3.5 cents per ton. 

“ (/) Flour. —Canal rate, 78 cents; loading in Minneapolis, same as on cars; 
transferring in Duluth-Superior (same as wheat), 33 cents; total, $1.11. (Loss 
of free storage and advantage of stocking up in Duluth-Superior during winter 
for spring opening). Railroad rate, $1. Loss, 11 cents per ton.” 

POINTS AS TO WHICH LOCAL BOARD IS IN ERROR. 

12. We respectfully suggest that the local board has perhaps unconsciously 
been led into certain errors, due, perhaps, to the acceptance of statements made 
by railway authortities and others interested in opposing the project as follows: 

(a) In finding, or perhaps assuming, that the decadence of inland-waterway 
traffic is due to inherent or economic inferiority of water transportation as 
compared with railway transportation, and therefore that the inland canals, 
rivers, and waterways of the United States are of no economic value in trans¬ 
portation and are not worthy of improvement, and hence that it is a waste of 
public money to continue the policy of the United States Government of ex¬ 
pending annually many millions of dollars in waterway improvements, and 
that such policy should be abandoned; also in assuming that the obstacles to 
successful waterway transportation due to railway hostility, unrestrained, cut¬ 
throat competition methods used by railways to destroy waterway traffic and 
amounting in effect to a boycott of such traffic hereinafter fully described, will 
continue in operation and either will not or can not be removed or prevented. 

(h) In finding terminal charges and costs of handling of freight to be as 
stated in the report and that the same will continue as found therein and can 
not be reduced so as to amount to not more than 3 to 10 cents per ton. In find¬ 
ing 25 cents per ton deterioration of coal in one handling by clamshell instead 
of finding that such deterioration amounts to practically nothing, being fully 
offset by shaking in box car from Duluth to Twin Cities. 

(c) In finding the average rail rates between Lake Superior and Twin Cities 
as low as $1,024 per ton, and especially the average rail rate on general merchan¬ 
dise. In assuming that existing rail rates will remain as low as at present and 
that railways will continue to be able to carry the rapidly increasing tonnage 
without congestion and consequent great public loss. 

(d) In finding total bulk tonnage only 3,295,000 tons for the year 1912 and 
assuming that amount as the total tonnage available to the proposed canal 
when the true basis should be an estimate of the total tonnage available for 
the year 1920, or the date when the canal will be completed. This should be 
determined by reference to average rate of increase during the past years, shown 
to be at least 15 per cent per annum. 

( e ) In finding the Erie Canal average freight rate at 3 mills per ton-mile 
and in finding the average rate of proposed canal 3 mills per ton-mile by com¬ 
parison with rates on the old Erie at a period when it had fallen into disuse 
through neglect and hostile railway control, when in fact the rate on the pro¬ 
posed canal should be found at not to exceed 1J mills per ton-mile on bulk 
commodities and 2 mills per ton-mile on other freight. 

(/) In finding that the proposed canal will not carry coal at any saving 
to the consumer, when in fact coal can be transported on the proposed canal 
at a saving of from 45 to 85 cents per ton, or a total saving at an average of 
50 cents per ton on 2,000,000 tons of $1,000,000, or more than twice $420,000, 
the amount found necessary by the local board to make the canal commercially 
feasible. 

( g ) In finding that the canal will not carry any other commodities, such as 
iron, steel, cement, lime, salt, sugar, grain, flour, and general merchandise, 
when in fact such commodities can he transported via canal at an average 
saving of 42 cents per ton, or a saving upon general merchandise on 1,000,000 


108 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER 


tons, $420,000; flour, 42 cents per ton, 1,000,000 tons, $420,000; north and east 
bound grain 42 cents per ton, 1,000,000 tons, $420,000 and a like saving upon 
limestone, building stone, brick, tile, commercial fertilizers, oil cake, potatoes, 
bran, shorts, grain, feed, hay, agricultural implements, pulp wood, etc., esti¬ 
mated 1,000,000 tons, at 42 cents per ton, $420,000. 

(h) In finding tlie canal project not commercially feasible and not worthy 
of being undertaken by the General Government. 

13. We will proceed to discuss the above proposition in the order stated. 

CAUSES OF DECLINE OF INLAND WATERWAY AND CANAL TRAFFIC. 

The leading authorities upon waterway transportation, including the Inland 
Waterways Commission, National Waterways Commission, Commissioner of Cor¬ 
porations, reports of committees of Congress, and writers upon the subject are 
unanimous in the finding that the decline of inland-waterway transportation 
has been caused and that the growth thereof is now prevented almost wholly 
by unregulated, unrestrained, and destructive railway competition. In the work 
of the destruction of 'waterway competition the railways have resorted to and 
still continue to use methods which are properly characterized as cutthroat 
methods of competition and destruction similar to the methods used by the 
Standard Oil Trust in past years and which seem to all fair-minded persons as 
unfair and immoral. In transmitting the preliminary report of the Inland 
Waterways Commission to Congress, Theodore Roosevelt, then President, said: 

“ The commission finds that it was unregulated railroad competition which 
prevented or destroyed the development of commerce on our inland waterways. 
The Mississippi, our greatest natural highway, is a case in point; one time the 
traffic upon it was without rival in any country. The report shows that com¬ 
merce was driven from the Mississippi by the railroads. While production 
was limited, the railways, with their convenient terminals, gave quicker and 
more satisfactory service than the waterways. Later they prevented the restor¬ 
ation of river traffic by keeping down their rates along the river, recouping 
themselves by higher charges elsewhere. They also acquired water front and 
terminals to an extent which made water competition impossible. Throughout 
the country the railways have secured such control of canals and steamboat 
lines that to-day inland-waterway transportation is largely in their hands. This 
was natural and doubtless inevitable under the circumstances, but it should 
not be allowed to continue unless under careful Government regulation. Com¬ 
paratively little inland freight is carried by boat which is not carried a part 
of its journey by rail also. As the report shows, the successful development 
and use of our interstate waterways will require intelligent regulation of the 
relations between rail and water traffic. When this is done the railways and 
waterways will assist instead of injuring each other. Both will benefit, but 
the chief benefit will accrue to the people in general through quicker' and 
cheaper transportation. * * * 

“ The commission recognizes that the cost of improving our inland waterways 
will be large, but far less than would be required to relieve the congestion of 
traffic by railway extension. The benefits of such improvement will be large 
also and they will touch the daily life of our people at every point, uniting the 
interests of all the States and sections of our country.” 

Waterways Commission are found statements of river carriers, boats, and lines, 
and private canals owned or controlled by railroads. Most of the canals owned 
by the railroads are abandoned and the ownership by railroads shows why and 
through what influences they have been abandoned. 

In the final report of the United States National Waterways Commission are 
found the following recommendations; 

“Further legislation for protecting waterways against railway competition 
and for establishing more amicable relations between the two agencies of 
transportation.” 

On page 19 the commission says: 

“The lack of adequate regulations makes it possible for the railways to 
effectually control or to crush out water competition through their ownership 
and control of boat lines. It is a well-known fact that the trunk-line railways 
through their control over terminals at Buffalo and their ownership of steam¬ 
ship companies on the Great Lakes, have been able to dominate lake-and-rail 
package freight business between New York and Chicago, and also to a con- 



WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 109 


siderable extent tlie grain traffic. On the business thus controlled the water 
rates have risen, while on the coal, iron, and grain traffic, not controlled by the 
railroads, the water rates have constantly declined. * * * Independent 

companies have been unable to compete successfully owing to the advantage 
which their railroad-owned competitor enjoys. * * * Also on some rivers 

the railways have acquired control of packet lines. 

“ While this rapidly increasing control of railways over water lines tends to 
bring about that harmony of cooperation between them which is necessary for 
the development of transfer traffic, it also has possibilities of harmful results 
which require regulation. Where the railways grant prorating arrangements 
to boat lines which they own or control, while denying the same privilege to 
competing independent lines, the latter are practically precluded from securing 
any transfer traffic, while on the local or port-to-port business they must meet 
the competition of the railway-owned boat lines, which are at liberty on this 
business to cut rates to any extent they choose. Under such conditions it is 
very difficult for independent lines to succeed, and the cases are numerous 
where they have been forced to retire from the held. 

“The situation calls for additional legislation, not only to prevent the 
elimination of water competition by this means, but also to protect the public 
against the raising of water rates which railway control over boat lines makes 
possible. Legislation to this end is as necessary for the preservation of water 
transportation as is the prohibition of rate cutting and other discriminatory 
practices. * * * 

“ The commission believes that the simplest and most effective means of 
securing these desired regulations is to give the Interstate Commerce Commis¬ 
sion greater control over water lines, and accordingly recommends that every 
water carrier engaged in interstate commerce which is owned and controlled 
by a railroad, or in which a railroad is in any way interested, and also every 
independent water carrier which operates over a specified route with regular 
schedules, be placed under the control of the Interstate Commerce Commission 
and be made subject to the same rules and regulations now imposed upon rail¬ 
way corporations in so far as they are applicable. The commission should, 
however, be given broad discretionary power in enforcing the requirements of 
(lie law, particularly those relating to the filing and changing of rates, so that 
no unnecessary burdens will be imposed upon water transportation. The com¬ 
mission also recommends that the Interstate Commerce Commission be em¬ 
powered to establish physical connection between the terminals of railways 
and boat lines where possible and desirable, and also to compel the charging of 
lower than the regular rates to river, lake, or seaports when the traffic is to 
be exchanged with water carriers. 

“ If water lines were made common carriers within the meaning of the law, 
the Interstate Commerce Commission would have power under the present 
statutes to establish through routes between rail and water lines and to require 
joint rates and through bills of lading. It would also have power to regulate 
the charges of water carriers and to require annual reports and other informa¬ 
tion by which to judge of the reasonableness of their charges.” 

On page 21 we find the following: 

“ The above-mentioned report on water terminals also shows that a large 
proportion of the most available water frontage is owned or controlled by rail¬ 
way corporations. Through this ownership or control they practically dominate 
the" terminal situation at most of our ports, and they have generally exercised 
their control in a manner adverse to water traffic. In many cases they hold 
large tracts of undeveloped frontage which they refuse to sell or lease, and 
which are needed for the construction of public docks. This railway control of 
terminals is one of the most serious obstacles to the development of water 
transportation, for the control of the terminal means practically the control of 
the route. An independent boat line has small chance of success where it is 
denied the use of docks and terminal facilities or is required to pay unreason¬ 
able charges for their use. The high terminal charges at many of our ports 
make it impossible for small boat lines to enter at all. 

“ The commission believes that the proper solution of this terminal question 
is most vital to the future of water transportation. * * * The commission 

emphasizes the recommendation made in its preliminary report that further 
improvements in rivers and harbors be not made unless sufficient assurance is 
given that proper wharves, terminals, and other necessary adjuncts to naviga¬ 
tion shall be furnished by municipal or private enterprise, and that the charges 
for their use shall be reasonable. It can not be too strongly urged that in many 


110 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


cases it is not the condition of channels so much as it is the lack of terminals 
that is retarding the development of water transportation. 

“ Where water frontage necessary for the establishment of public terminals is 
held undeveloped by railway or other private interests, a special act of the 
legislature should be passed, empowering State or municipal officials to con¬ 
demn such property for public use. This plan has already been followed in a 
few cases and should be more widely adopted.” 

14. In the chapter on canals in the United States, at page 188, preliminary 
report Inland Waterways Commission, it will be found that through purchases 
of stock, lease of canals, ownership of canal boats, discriminations against inde¬ 
pendent canal boats, discriminations against shippers using canals and other 
similar methods the railways were responsible for the decline of traffic upon or 
abandonment of most of the canals which have been abandoned or upon which 
traffic has declined. For instance, on page 259 it is said the principal reason 
why the Delaware & Raritan Canal is falling into disuse is the fact that the 
railway company (lessee) neglects to keep the canal in repair or to make neces¬ 
sary improvements to accommodate it to the needs of the present-day traffic, 
and to the further fact that it erected a number of bridges over the canal which 
are so low as to prevent the passage of steamers. The commission quotes with 
approval an opinion that the above canal, if put in condition and properly 
managed, could earn a dividend of 25 per cent on its capital. We quote from 
the same page as follows: 

“ The Bureau of Corporations is in possession of considerable evidence tend¬ 
ing to show that the control of the Delaware & Raritan Canal by the Pennsyl¬ 
vania Railroad has been detrimental to interstate commerce.” 

Then follows a summary of the evidence. 

The famous Morris Canal, extending from the Delaware River at Phillips- 
burg, N. J., through New Jersey to the Hudson River to Jersey City, a distance 
of 102 miles, completed in LS36 at a total cost of $6,000,000, was leased in per¬ 
petuity in 1871 to the Lehigh Valley Railway Co. 

The Lehigh Canal in Pennsylvania, costing $4,455,000, leased to the New 
Jersey Central Railroad. And so practically all of the canals in the East, except 
the Erie Canal, have come under railroad control or influence, including the 
famous Chesapeake & Ohio Canal extending from Cumberland, Md., to Wash¬ 
ington, D. C. 

At page 316 of this report, speaking of methods of crushing out water com¬ 
petition on the rivers of the South, the commission said: 

“Moreover, it appears that in some cases the steamboat lines are controlled 
by the railroad interests, while in other cases there is a division of the busi¬ 
ness which leaves the steamers only a fixed proportion of the low-grade 
freight. * * * # 

“ In short, it appears that the railroads put in force rates so low as prac¬ 
tically to drive the water lines out of business.” 

Speaking of the traffic on the Great Lakes the commission says: 

“ The advantages of the lake routes are further shown by the fact that all 
the important trunk lines of railroads control lines of vessels operating on the 
Great Lakes; this railroad control of lake lines reducing the effectiveness of 
the water competition on most freight except ore and coal and possibly 
lumber.” 

Speaking of coastwise traffic and influence of railroads thereon, the com¬ 
mission says: 

“ By these various water lines, freight rates on bulk commodities and also, 
to a large extent, on package freight, are so much below railroad rates that 
the rail lines can hardly be said to compete for a large part of the traffic. 
The influence of water competition is, however, reduced to some extent, as on 
the Lakes, by the control of several important coastwise lines by railroad in¬ 
terests, either through ownership of stock or in other ways. These and other 
coastwise lines are members of traffic associations in which railroad interests 
are also represented.” 

Speaking of river traffic in connection with railway control, on page 330 the 
commission says: 

“A representative of one of the packet lines on the Ohio states that up to 
about 1900, when the United States Steel Corporation was formed, Pittsburgh 
boats had prorating arrangements with practically all the railroads tapping 
the Mississippi River, as well as the Ohio River, and reaching the South and 
West. At about the time mentioned, they received verbal notices from all these 
railroads through their commercial representatives terminating through rates. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. Ill 


Instead of being able to quote through rates as formerly the packet lines are 
now obliged to quote their own rate to the point where they connect with the 
railroad and then add the local tariff rate of the railroad from that point to 
destination. The railroads formerly issued joint tariff sheets with the packet 
lines just as they do with other roads. 

“ The reason assigned by such roads as the Louisville & Nashville and die 
Queen & Crescent for the termination of joint tariff relations was the pressure 
brought to bear upon them by the roads out of Pittsburgh. 

“ The loss of prorating arrangements has been a very serious matter to some 
of the packet lines. It has practically ruined the traffic in horseshoes, cotton 
ties, bar iron, wire nails, staples, etc., to the South and West, which was for¬ 
merly extensive. 

“A few years ago arrangements were in effect whereby shipments could be 
made from Pittsburgh territory and prorated via river and rail to Atlanta, 
Ga.; Chattanooga, Tenn.; Birmingham, Selma, and Montgomery, Ala.; Rich¬ 
mond and Roanoke, Va.; and Texas, Colorado, and California points; but the 
community of interest under which the railroads now seem to work caused 
the withdrawal of the prorating arrangements at almost all points on the Ohio 
and Mississippi rivers, thus compelling shippers to forward by all-rail lines 
instead of river and rail routes. Formerly shippers gladly availed themselves 
of prorating arrangements, particularly when there was a shortage of cars 
or congestion of freight.” 

Also on page 332, the following: 

“ Prior to the building of the division of the ‘ Frisco ’ Railway between St. 
Louis and Cape Girardeau, Mo., the Eagle Packet Co. had prorating arrange¬ 
ments on much through business by way of the latter point, but since the line 
was completed the railroad has discontinued the prorating arrangements and 
the packet company can get no other arrangements with railroads at St. Louis. 

“ The prorating between Arkansas River Packet Co. and the railroads was 
given up at the beginning of 1907. According to. the packet company the rail¬ 
roads, after taking .shipments of cotton for the East and for export would 
cause delivery to he delayed after they had loaded it on cars from the boat 
line, and would hurry their own shipments to attract business to the railroads. 
The boat line had to pay the same rate as other local shippers.” 

On pages 375-376 of that report will be found a list of water lines and 
private canals owned or controlled by railways. 

With reference to the decline of water-borne traffic the National Waterways 
Commission, on page 68, says: 

“ The many advantages which a railway has in competition witli a water 
route may be grouped into two general classes. 

“ 1. Those inherent or fundamental advantages which are based upon per¬ 
manent conditions. 

“2. Those advantages pertaining to railways which may be deemed artificial 
or temporary. These are due to conditions not necessarily permanent in their 
nature.” 

Under the second head the commission refers to the right of the railway to 
charge lower rates between points where their line is in competition with 
water routes. The power of the railways to acquire steamboat lines or enter 
into agreements with them for the purpose of stilling water-borne traffic, either 
by operating the steamboat lines or by discontinuing their use upon com¬ 
petitive routes, the commission says, page 70: 

“ In both methods, namely, in the acquisition and operation of steamboat 
lines in such a manner as not to compete with railways, and in removing them 
entirely from the field of competition, the railway companies of the country 
have been very active. 

“A third advantage arises from the refusal to prorate on through routes on 
which naturally freight would be carried part of the way by rail and part by 
water. In many cases the route, which apparently is the natural one, would 
be by water for three-fourths or more of the distance, yet the charge for the 
remaining railway haul is so considerable as to render carriage for the longer 
haul by water unprofitable. 

“A fourth advantage of the railways, in this class, is the far greater atten¬ 
tion given to provision for warehouses, terminals, and the equipment for 
handling freight. On many of the waterways very little, if any, progress has 
been made during the last 50 years in furnishing modern facilities for the 
storage or handling of traffic. In each of a considerable number of cities 


112 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER 


located upon rivers and canals in Germany the members of the commission 
during their recent inspection trip saw a larger investment for terminals and 
for the storage of freight and handling of boats than exists on the whole 
Mississippi River above New Orleans.” 

The commission then refers to the fact that in localities where water-borne 
traffic has increased as on the Great Lakes careful and elaborate provision has 
been made for the handling of freight in the most economical manner. The 
reference to freight-handling facilities is intended to mean facilities for han¬ 
dling bulk freight, such as coal, iron ore, and grain. Further with reference to 
lake traffic, we quote from the commission (p. 71) : 

“ Notwithstanding the immense traffic on these lakes, it is, however, a 
noticeable fact that the quantity of general merchandise or package freight 
has not kept pace with the' far more rapidly • increasing traffic in the staple 
articles—iron ore, coal, grain, and lumber.” 

The reason for this will be shown later, and it is because such freight is 
controlled by railways who diverted it to railway lines. 

On the subject of railway control of waterways, on page 515 of the final 
report of the National Waterways Commission, it is said: 

“ The indifference of local authorities to the development and control of their 
terminal facilities largely nullifies the benefits that might result from the 
appropriations by Federal Government for channel improvements, and the 
control which the railways have obtained over desirable water frontage has 
been very detrimental to the growth of water transportation. At Buffalo, 
Philadelphia, and other ports the railways often refuse the use of their docks 
to independent boat lines or allow such use only on condition that the freight 
unloaded on them shall be sent over their lines. Where they own boat lines, 
as on the Great Lakes and in the coastwise trade, their control over terminal 
facilities is a most important factor in eliminating the competition of inde¬ 
pendent lines.” 

And further, on the same subject, the commission, on page 533, says: 

“An essential factor for the success of water transportation is the existence 
of amicable relations between the railways and waterways. A country may 
possess fine rivers, well improved, and may also have a large population and an 
abundance of coarse, bulky commodities, requiring transportation, but if the 
railways are allowed a free hand, they will divert most of the traffic from the 
waterways, even though the latter may afford cheaper transportation. In com¬ 
peting with waterways the railways have a distinct advantage. Only a small 
portion of their traffic is suited for water transportation. As a rule, little com¬ 
petition is possible on their passenger, express, and high-grade freight business. 
On the other hand, practically all the traffic of a waterway may lie subject to 
rail competition. Furthermore, the railroad competes with water route only at 
comparatively few points, when the whole system is taken into consideration, 
while the water route is usually in competition with the railway at most all 
points. Under such conditions the rairoad can recoup itself for losses incurred 
by rate cutting on a few commodities and at a few points from the profits it 
makes on all the traffic not affected by water competition, while the water car¬ 
rier, financially much weaker and having few, if any, way stations where it 
enjoys a monopoly of the business, has little opportunity to recoup itself any¬ 
where. Thus the two never compete on equal terms and the relative cost of 
transportation, which should be the deciding factor, ordinarily makes little dif¬ 
ference in the outcome of the contest. In the long run if the railway forces the 
competition the water carrier is almost certain to succumb. Oniy on large 
bodies of water has it any chance at all. 

“A railway may also greatly limit the business of a waterway by preventing 
the exchange of traffic between the two. This can be accomplished by charging 
high local rates to and from transshipment points and by refusing to make 
prorating arrangements with water carriers and to establish suitable connec¬ 
tions with terminals. In this way the inconvenience and cost of transferring 
freight is greatly increased. This method of competition becomes most prom¬ 
inent when the railway system is fairly complete and the different roads are 
working in harmony. As long as a waterway acts as a feeder for a railway, 
cooperation for the exchange of traffic will be manifest (p. 534). 

“ It may prove cheaper for a railway to control water carriers than to compete 
against them, especially when the natural advantages of the former are great. 
Thus it was the policy of railroads at one time to purchase outright or secure a 
controlling interest in competing canal companies. The common method in the 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 113 


United States now is for the railways to own or control boat lines. Where 
they also own the terminal facilities at a port, it is a very easy matter to prevent 
serious competition from independents. The view was once held that the water¬ 
ways were free highways on which competition would always exist, but what 
has transpired in the United States during the last decade indicates that even 
water transportation may be monopolized or so effectively controlled that it is 
hazardous for independent boat lines to enter the field. 

“ The experience of all countries has been that as long as (he railways were 
not subject to strict control, they have succeeded in crushing out or controlling 
water competition. The regulation of railway activities for the protection of 
water carriers has, accordingly, been found necessary**!n all countries before the 
normal development of water transportation could take place.” 

And on page 538 the commission says: 

“ No serious attempt has yet been made in the United States to regulate the 
relations between the railways and waterways. The prevailing opinion at the 
time the interstate commerce act was passed in 1887 was that the waterways 
were the great regulators and cheapeners of railway rates, and for this reason 
should be hampered as little as possible by Federal regulation.” 

Later, on page 540, the commission refers to the amendment to the interstate 
commerce act of 1910 preventing railroads which have lowered rates to compete 
with water routes from increasing the same until after a hearing, that is, to 
prohibit railways from cutting rates for the purpose of driving out water com¬ 
petition and then raising them again, but it is said by the commission: 

“ It can not accomplish much for the reason that the common practice of rail¬ 
ways now in competing with inland waterways is to keep their rates constantly 
at such a low figure that water transportation is not profitable. * * * 

“ The tendency in the United States as in England, has been to increase the 
power of the Government over water transportation. It was made necessary 
in England by the control which the railways had secured over the canal com¬ 
panies. In this country it has been due to the rapidly increasing control of 
railroads over boat lines, especially on the Great Lakes and in the coastwise 
trade. Where the railways and boat lines are operated under joint tariffs, the 
Interstate Commerce Commission has found it practically impossible to judge 
of the reasonableness of such rates without having a greater knowledge of the 
affairs of the connecting boat lines. Accordingly, since 1887 it lias recom¬ 
mended on numerous occasions that the law be extended to apply to common 
carriers by water at least to the extent of giving them power to collect statis¬ 
tics and demand reports. * * * 

“ It is gradually coming to be realized in this country that the laissezfaire 
policy regarding water transportation is hardly more successful than when ap¬ 
plied to other forms of business activity. The lack of proper regulation has 
materially aided the railways in crushing out or controlling water transpor¬ 
tation and our rivers are no longer the cheapeners and regulators of railway 
rates that they once were. Even on the Great Lakes the railways have secured 
such control over the transportation of higher classes of freight between New 
York and Chicago that they have been able to raise the rates, while on traffic 
which they do not control the rates have continually declined. Also in the 
coastwise traffic the railways have secured such complete control that there is 
no longer any active competition. Independent companies can not successfully 
compete. This situation has led to proposals for securing additional legisla¬ 
tion. A provision which has attracted a good deal of attention is contained in 
the so-called Panama bill. It makes it unlawful for any railroad company to 
own, lease, operate, control, or have any interest whatsoever in any common 
carrier by water with which it competes for traffic. A recommendation of some¬ 
what different tenor is made by the National Waterways Commission in its final 
report. It proposes to extend the power of the Interstate Commerce Commis¬ 
sion over all water carriers owned or controlled by the railways and also over 
all independent companies operating on regular schedules between specified 
points so that they may not be used in a manner prejudicial to the public good. 
The merits of these two propositions will be discussed in the last chapter. It 
may confidently be expected that in the near future legislation of some kind 
will be adopted.” 

Again, on page 555, the commission says: 

“Almost all the package freight business on the Great Lakes is carried by 
railway-owned steamship lines operating in connection with the railways on 
through rates. Some of the independent companies also prorate with the rail¬ 
ways on a small proportion of their business. * * * 

H. Doc. 1008, 64-1-8 



ll-t vt Aii-.it Vv A1 FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


“ Where a boat line is owned by a railroad it is very difficult, as a rule, for 
independent companies to compete with it, inasmuch as the railway-owned 
boat line enjoying prorating arrangements generally has a monopoly of all the 
transfer traffic and is also able to compete on equal terms for the local, or port- 
to-port, traffic. There are many instances in the United States where independ¬ 
ent companies not enjoying prorating arrangements with railways have been 
driven out of business. This has led to the proposal to clothe the Interstate 
Commerce Commission with greater powers over activities of water carriers, so 
that the advantage which a railway has by reason of its ownership of a boat 
line may not be used to eliminate water competition and to raise water rates.” 

15. As early as 1872 unfair competition by and discriminations of railways 
against water-borne traffic was recognized, as appears by the report of the Win- 
dom committee on transportation routes, found at page 582 of the preliminary 
report of inland waterways commission, which recommended: 

“ That all railway companies and freight organizations, receiving freights in 
one State to be delivered in another, and whose lines touch at any river or lake 
port, be prohibited from charging more to or from such port than for any 
greater distance on the same line. * * * 

“ The uniform testimony deduced from practical results in this country, and 
throughout the commercial world is, that water routes, when properly located, 
not only afford the cheapest and best known means of transportation for all 
heavy, bulky and cheap commodities, but that they are also the natural com¬ 
petitors, and most effective regulators of railway transportation. * * * 

“ The above facts and conclusions together with the remarkable physical 
adaptation of our country for cheap and ample water communications, point 
unerringly to the improvement of our great natural waterways, and their con¬ 
nection by canals, or by short freight railway portages under control of the 
Government, as the obvious and certain solution of the problem of cheap trans¬ 
portation.” 

16. The latest report dealing with the subject of railway monopoly and its 
control of waterway and canal traffic is the report of the Committee on the 
Merchant Marine of the House of Representatives dated March 5, 1914. 

REPORT OF COMMITTEE ON MERCHANT MARINE. 

The report of this committee was made after two years of thorough and ex¬ 
haustive investigation covering the entire subject of water-borne traffic, for¬ 
eign and domestic, together with the relation of railways thereto, including a 
study of the methods and results of railway competition and control. It finds 
in existence various combinations and consolidations practically controlling the 
entire field of water-borne commerce, foreign and domestic, including control of 
coastwise shipping water-borne traffic on inland rivers, waterways, canals, and 
the Great Lakes. It finds coastwise traffic is largely controlled by railways and 
shipping combinations; that inland water traffic on canals, rivers, waterways 
and the Great Lakes is almost wholly controlled and dominated by railways; 
that such railway control has been used for the purpose of destroying water 
traffic and waterway competition, including rivers, canals, waterways, and in 
part upon the Great Lakes, all to the great loss and detriment of the public 
because the higher cost and rates on all waterway traffic and the constant de¬ 
cline of the traffic on waterways and the increased freight movements on rail¬ 
ways at higher rates. The report is an indictment against railway methods and 
railway control of waterways and water trnsporttion. The committee recom¬ 
mends legislation which would protect waterways from unfair, illegitimate, cut¬ 
throat railway competition and free water-borne commerce from railway con¬ 
trol and domination, restoring to waterways their natural function of furnish¬ 
ing cheap transportation, especially for bulk freight. The report shows that the 
methods used by railways to destroy waterway competition are of the same 
general character formerly used by the Standard Oil monopoly to destroy its 
competitors and includes nearly every unfair method alleged to have been 
used by that monopoly. 

We take the liberty of freely quoting from the findings and recommendations 
of the committee. 

We believe the report demonstrates that the obstacles to the commercial 
feasibility of the proposed canal are almost wholly artificial; that they are 
largely the result of railroad hostility to waterways and unfair and improper 
railway discrimination and competition; that such obstacles are removable 
and preventable by proper Federal and State legislation and local action and 
that if the recommendations of the committee are adopted by Congress and 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 115 


the States and localities interested in restoring waterway traffic, the result 
will be a great revival of water-borne commerce in the United States such as 
has taken place in Europe within the past generation. When the subject is un¬ 
derstood by Congress and the States and localities interested, we think there is 
no doubt whatever but that ample remedial legislation and action will follow 
within a reasonable time. It is not logical or fair to assume that the United 
States Government will permit the hundreds of millions of dollars it has in¬ 
vested in the matter of waterways to be wasted for the lack of proper legisla¬ 
tion, for want of which practically the entire investment of the United States 
Government in such waterways is now worse than wasted. 

The following quotations are from Volume IV of the report of the committee: 

METHODS BY WHICH RAILWAYS CONTROL WATERWAY COMPETITION. 

“ Competition in rates between domestic water lines, however, has been 
quite ns effectively eliminated as in the foreign trade and this has been accom¬ 
plished by the several lines through one or more of the numerous methods dis¬ 
cussed in Part II of the foregoing report anti summarized on pages 409 to 412” 
(p. 421). 

“ Methods of control summarized. —The numerous methods of controlling com¬ 
petition between water carriers in the domestic trade, referred to in the pre¬ 
ceding pages, may be grouped under three headings, viz: (1) Control through 
the acquisition of water lines; or the ownership of accessories to the lines; 
(2) Control through agreements or understandings; and (3) Control through 
special practices. Briefly summarized, the various methods adopted for the 
control of competition are the following: 

“ I. Control through the acquisition of water lines or the ownership of acces¬ 
sories to the lines: 

“ (1) Direct railroad ownership and operation of water lines, the railroad’s 
marine interests not being incorporated separately (pp. 377-390). 

“ (2) Railroad ownership through subsidiaries, or subsidiaries of subsidia¬ 
ries, either rail or water (pp. 317, 318, 373-376). 

“ (3) Control by lease, especially in the case of canals (p. 408). 

“ (4) Ownership of boat lines by other boat lines, or by holding com¬ 
panies (pp. 352, 353, 378, 379, 383-386). 

“ (5) Joint control of a water line by several railroads (pp. 317, 318, 
3S6-388). 

“ (6) Control of one water carrier over another, or of a railroad over a 
water line, indicated by one or more officers in common or by common repre¬ 
sentation on the board of directors (pp. 344-346, 350). 

“ (7) Control indicated by a community of interest through influential 
stockholders (pp. 344-346). 

“ (8) Railroad control of competing water lines or canals through the owner¬ 
ship or control oi forwarding companies, thus diverting traffic to their own rail 
or water lines by refusing to exchange through freight with independent water 
lines. The latter are thus forced to depend upon local business, which ii too 
limited to maintain the efficiency of the line (pp. 325-327). 

“ (9) Railroad or steamship company ownership of exclusive terminal facili¬ 
ties (pp. 323, 324, 327, 328). 

“ (10) Ownership or control of bulk carriers by producing and trading com¬ 
panies, which, while controlling a large portion of the traffic in a given com¬ 
modity, also act as common carriers. These companies may also charter boats 
of independent lines, on such favorable terms as to induce such lines to observe 
a certain policy in the fixing and maintenance of rates (pp. 337, 338, 344, 345). 

“ II. Control through agreements or understandings: 

“ (11) Through agreements between water lines to divide the territory or 
charge certain rates. Unlike the practice in the foreign trade, such agreements 
are few in the domestic trade, the desired elimination of objectionable competi¬ 
tion being effected through any one or more of the other methods (pp. 399, 400). 

“ (12) Through traffic associations, participated in by railroads and water 
lines, which publish tariffs but do not definitely bind the lines, i. e., there is no 
express agreement to observe the rates. While the water lines are emphatic in 
reporting that their affiliation with existing tariff associations or conferences 
is simply for the purpose of discussion and interchange of information and 
opinions on matters of mutual interest, and that their rights of separate and 
independent action are in no way restricted, the testimony shows that the 
rates and divisions of rates are determined at these conferences in such a 


116 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER, 


manner as to cause no discrimination against any of the members and to place 
the rate divisions for all lines via one gateway on the same basis (pp. 396, 397). 

“ (13) By requiring the unanimous consent of the existing members in cer¬ 
tain traffic associations or conferences before admission can be secured by an 
outside line. Not to be granted membership in such associations places the 
outside line at the disadvantage of publishing tariffs at its own expense and of 
not being able to enjoy the same through rail-and-water rates as the conference 
lines (pp. 396-398). 

“ (14) Agreements or understandings not to charter or sell vessels to certain 
lines or for certain trades (pp. 392, 393). 

“III. Control through special practices: 

“ (15) A railroad obtains control of a water line or canal and (1) fails to 
maintain the efficiency of the same, thus making water transportation so ex¬ 
pensive as to eliminate competition, or (2) fixing rates so high as to preclude 
its use, or (3) abandons the property (p. 408). 

“ (16) A railroad charters space from a competing water line, although not 
using it, thus depriving shippers of space and making them dissatisfied with 
the water-line service (p. 360). 

“ (17) A railroad or its controlled water line or terminal company holds all 
the available docks and shedded piers and refuses access to an independent line 
for the purpose of discharging and receiving cargo, or allows access only upon 
payment of unreasonable charges. The independent line is thus required to 
unload at some other dock and team the goods to and from the railroad sta¬ 
tion (pp. 323, 324, 327, 328, 356). 

“ (18) A railroad or its controlled water line owns the available water front¬ 
age, which it refuses to utilize, at the same time refusing to release the same 
by sale or otherwise (pp. 323, 324). 

“(19) A railway-water line or large all-water line cuts rates unduly (either 
by putting ‘ fighting ships ’ in the trade or by having its regular boats quote 
unremunerative rates) and when competition has been destroyed advances the 
rates even higher than they had been originally. While cutting rates the large 
company recoups itself out of rates at noncompetitive points or on through 
business secured from railroads on a favorable basis (pp. 385, 386, 393, 394, 
407). 

“(20) Railroads manipulate rates so as to make differential between their 
all-water, all-rail, and rail-water routes ineffectual as far as water transporta¬ 
tion is concerned. The only inducement to use the water route is economy, and 
if the differential between the rail and water rates is made such as to just 
counterbalance the disadvantages of the water route the railroads will secure the 
business because, all things considered, their service is preferred (pp. 328-330). 

“(21) Water lines make contracts with shippers whereby rebates or special 
rates are granted if the shipper transports his entire produce by a given line. 
Such contracts with important shippers greatly handicap independent lines in 
getting sufficient freight, especially if the contracting line spreads the report 
that the independent line will be allowed to remain in business only a short 
time. The important shippers, their business once obtained, can be held in line 
or disciplined (pp. 395, 396). 

“(22) Large established water lines bring influence to bear on marine 
insurance underwriters whereby the independent line can secure only a less 
favorable rate, having due regard for the class of vessel, than its large and 
well-established competitors, thus forcing the independent carrier to equalize 
the extra cost of insurance in its rates to shippers to (p. 395). 

“(23) Railroads or steamship combinations can allow competing lines a 
certain amount of freight with the implied knowledge on the part of the com¬ 
peting line that the railway or steamship combination possess the power to 
withdraw this allotted freight if the competing line shows aggressiveness or is 
unwilling to conform to the line of conduct desired. Often valuable season 
contracts are made with independent water lines, which these lines do not wish 
to lose by competing for freight (pp. 342, 344, 345). 

“(24) Railroads may divert bulk traffic from watercourses by granting spe¬ 
cial commodity rates ‘ in transit ’ such as ‘ milling in transit ’ and ‘ compressing 
in transit ’ (p. 322). 

“(25) Railroads can give access to docks to preferred water lines with which 
they have special arrangements, thus forcing shippers to other water lines to 
pay a series of charges for switching, docking, and unloading, and putting them 
to much inconvenience. In effect it means that the shipper who wishes the 
proper service must use the water line preferred by the railroad (pp. 334 335 
399). 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 117 


“(2G) Railroads may refuse to issue through hills of lading except to favored 
lines, thus preventing independent lines from obtaining transfer traffic. To 
deprive an independent line of the advantage accruing from a joint rate 
arrangement with railroads places the line in a defenseless position as com¬ 
pared with competing lines not thus handicapped. Without such an arrange¬ 
ment the independent line can not secure interior freight and is limited largely 
to port-to-port traffic, which is too small in volume to support the line. On the 
other hand, the water line having the prorating arrangement can cut rates to 
an unremunerative basis on the port-to-port traffic, thereby eliminating its less 
fortunate competitor, and recoup its losses in large measure out of the profits 
secured on the through business (pp. 349, 350, 354-356, 400, 401). 

“(27) Railroads charge more for the local haul from Buffalo to seaboard 
points, for example, on grain that is taken to Buffalo by boat than the pro¬ 
portionate share of the all-rail haul from Chicago to the seaboard, thus making 
the through rail-water route unprofitable as compared with the all-rail route. 
The local rate for the eastern rail haul is so high as to leave little to the 
independent water-carrier for its local lake haul (pp. 321-323). 

“(28) Railroads can greatly reduce rates between these points only where 
they are competing with an independent water carrier. Since most of the 
traffic of a large railroad system is free from water competition, it can afford 
to lower the rates on the competitive traffic to an unremunerative basis without 
appreciably affecting the earnings of its entire system ” (p. 407). 

We quote from the findings as to specific instances of railway control of 
waterways and practices by which such control has been effected (p. 317) : 

“ Control of through-package freight business by railroad-owned boat lines .— 
Enumeration of railroad-owned steamship lines: Although numerous inde¬ 
pendent steamship lines operate in the local port-to-port traffic on the Great 
Lakes, the through traffic from the western gateways on the Lakes, such as 
from Chicago and Duluth, to the eastern seaports via Buffalo, is controlled 
exclusively by six boat lines owned by the trunk line railroads connecting the 
East and Central West.” 

The report then enumerates the various lines of railway and gives by name 
and tonnage, etc., the boat lines controlled. 

On page 319 we quote: 

“ Methods by which railroads owning standard lake lines have prevented 
independent water carriers from participating in the through-package freight 
traffic. Up to the time that the trunk railroad lines reached only to Buffalo, 
and had no interest in rail lines to the west of Buffalo, it was to their interest 
to maintain the lake lines in such a manner as to attract the largest amount of 
tonnage to Buffalo. But, with the extension of their rail lines to the west, 
their policy changed ; and instead of attracting all possible tonnage to the lake 
lines connecting Buffalo and the west, every effort was made to divert water¬ 
borne traffic to their rail lines and to prevent independent water carriers from 
securing an important foothold. * * * 

“ So long as this class of freight originates on the railroads and is controlled 
by them, it is in their power to say to whom they will give it. They will not 
share it with any individual carrier that might offer, and they have thus con¬ 
trolled its movements. (Vol. 2, p. 842.) * * * Only boats owned by the 

railroads may engage in the package freight business between Chicago and 
Buffalo. If these two cities were both destination points for traffic, of course 
nonrailroad owned vessels could not be excluded from competition. But Buffalo 
is not a destination point. It is a transfer station. Goods reaching Buffalo by 
lake must go east by rail or canal. Likewise, freight from the east reaching 
Chicago water borne must be brought to Buffalo by rail or canal. The railroad 
makes with its own boat lines a through route and a joint rate from Chicago to 
the eastern destination, or vice versa. (Report of the Chicago Harbor Com¬ 
mission, 1909, p. 187.) In fact, all the testimony before the committee is to the 
effect that the through transportation of strictly package freight on the Lakes 
is completely under the control of the railroad-owned lines” (p. 320). 

“ Having become masters of the water-borne package freight business between 
Chicago or Duluth and Buffalo for transshipment to the seaboard, the railroads 
began the attempt in 1908 to secure control of the large grain movement to the 
east via the Lakes, a traffic handled largely by tramp steamers which seek to 
make their rates from port to port without reference to rail transportation. 
The policy of the railroads in this respect is to charge more for the local haul 
from Buffalo to the seaboard on grain that is taken to Buffalo by boat than 
the proportionate share of the all-rail haul from Chicago to the seaboard. The 


118 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 



effect of this policy is twofold, viz, (1) to divert the movement of grain from 
the Lakes to the railroads, and (2) to make the local rate between Buffalo and 
the eastern destination so high as to leave little to the independent water 
carrier for its local lake haul after paying the rate for the local rail haul ” 
(p. 320). 

On page 324 we quote: 

“ Railroad control of the Erie Canal .—In view of the railroad control of the 
standard through lake lines, as well as the lake haul eastward of Buffalo, it 
may he asked: Can not independent lake carriers utilize the Erie Canal route 
for shipments from the west to the seaboard? The answer is that this route 
is also completely dominated by the railroads as far as through traffic is con¬ 
cerned. Although at one time this waterway served as an important connect¬ 
ing link between the West and the East and exerted a powerful influence on 
rail rates, the railroads as early as 1878 sought to control this traffic, and since 
that time have lost no opportunity of diverting the canal traffic to their own 
lines by one method or another. Their control of the Erie Canal has become so 
effective that the carriage of through freight on the canal—i. e., freight origin¬ 
ating outside of the State of New York—has, according to the findings of the 
New York Barge Canal Terminal Commission, ‘ almost reached the vanishing 
point.’ Thus, during the year 1910, which is representative of recent years, the 
shipments of both through and way freight on the State canals of New York 
totaled only 3,473,412 tons, and of this only 805,180 tons represented through 
freight. In other words, the way freight—i. e., freight to or from points on the 
canals—was 3.31 times the through freight, thus showing that the Erie Canal 
has become relatively unimportant as a route for the carrying of freight be¬ 
tween the Great Lakes and the Atlantic seaboard. (Report of the New York 
Barge Canal Terminal Commission, 1911, Vol. I, pp. 03, 64.) 

“This declining importance of the canal is largely due, as already pointed 
out, to the efforts of the railroads to divert the traffic to their own lines, and 
the following factors may be briefly mentioned as indicating the methods which 
the railroads have pursued in accomplishing this purpose.” 

Here follows an enumeration of the railways which acquired various canal, 
lines on the Erie and an explanation that the canal lines controlled by the rail¬ 
ways are really railroad forwarding agencies which own no boats but solicit 
freight from shippers and charter canal boats from individual owners. 

On page 32G we quote: 

“The railroad forwarding agencies, enumerated above, together with a 
few independent canal lines, are members of the New York Canal Forwarders’ 
Association. According to the report of the commissioner of corporations, 
the railroad agencies have also effected an association of their own known as 
the New York Canal & Lake Agents’ Association, and this organization, to¬ 
gether with the Association of Lake Lines (also dominated by the railroads), 
arranges and publishes the through rates via the canal as well as joint canal 
and lake rates. 

“Having acquired all the through lake lines connecting Chicago and Duluth 
with Buffalo, and controlling the leading forwarding agencies on the canal, it 
was comparatively easy for the railroads to divert the canal traffic to their own 
rail or lake lines by refusing to exchange freight with independent canal 
lines or forwarders, except upon the payment of full local rates from Buffalo. 
As pointed out by the commissioner of corporations (report of Dec. 23, 
1912, p. 59), ‘the canal rate to Buffalo plus the rail rate, or the local lake 
rate, from Buffalo to the west makes the through rate so high as compared 
with the through rate of railroads, by their canal-lake-and-rail lines to western 
points, that the independent forwarding agencies virtually have no chance to 
do business.’ In other words, the independent canal lines were prevented from 
having any lake connections, and were thus forced to depend upon local canal 
business, which was relatively small. Relative to this practice the New York 
Barge Canal Terminal Commission reports that (p. 327) — 

“ ‘Canal boats are greatly handicapped because of the lack of the through 
bills of lading so invariably used by the railroads and which, of themselves, 
so greatly facilitate shipments by the railroads. * * * Again, the railroads 

have always refused to either prorate or through rate with canal carriers, but 
on the contrary, have only been willing to receive freight brought to them by 
canal boats in the most unusual and expensive manner, such as by forcing 
them to discharge their freight at places other than the railroad wharves, 
and then team it to the railroad wharves, instead of allowing them to come 
direct to the railroad wharves and there discharge their freight. By 
refusing, on the other hand, to deliver freight to canal boats at their wharves, 





WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 119 


they have been able to prevent them from carrying large quantities of freight 
that would otherwise have been shipped by tlie canals.’ (Report of 1911, p. 78.) 

“In connection with the foregoing factors should be mentioned the railroads’ 
policy of acquiring the terminal facilities at both Buffalo and New York, 
thus forcing the independent canal lines to even abandon most of their local 
business. The effect of this railroad control of terminal facilities is explained 
at great length in the 1911 report of the New York Barge Canal Terminal 
Commission and is regarded by the commission as the greatest obstacle con¬ 
fronting transportation on the Erie Canal. Thus- as regards Buffalo, with 
reference principally to the eastbound trade, and especially grain which is 
the chief item of eastbound through traffic, the report states: 

“ ‘The package freight business is wholly in the hands of the railroads, 
chiefly because of their terminal facilities and because the canals have hitherto 
possessed no terminal facilities whatever. Until facilities of an entirely in¬ 
dependent character are established at Buffalo for transshipments, it is 
unlikely that there will be any considerable increase in through freight traffic 
upon the canals, however they may be enlarged short of avoiding the break¬ 
ing of bulk at that city. * * * In the case of grain, there are but three or 

four ‘independent’ grain elevators. There being no wharves or other facilities 
at Buffalo reserved for the use of vessels bringing cargoes there from lake 
ports that might be carried on the canals, these boats are practically forced 
to lie up at privately owned—generally railroad-owned—wharves, thus facili¬ 
tating the shipment of the freight by the railroads, since the latter refuse 
to afford any accommodation at their wharves for canal boats attempting to 
obtain cargoes for eastern carriage, as well as denying to all canal boats—other 
than those chartered by them—access to their wharves for the shipment 
of freight brought west.’ (Report, 1911, pp. 77, 78.) 

“Again with reference to New York City, report states: 

“ ‘ There has never been any section of the improved water front in New York 
City, not even at the so-called canal basins, or canal districts, where there were 
any facilities other than the unshedded wharves for the accommodation of freight 
destined for shipment over the canals or for freight received from the canals. 
There has, even at such open wharves, been no one to receive and care for any 
freight that might be received either for shipment over the canals or that might 
be received at them by canal boats for local use. Lacking these essentials to the 
modern handling and carriage of freight, it was inevitable that the through 
business should have almost vanished.’ (Report of 1911, p. 77.) 

“Effects of railroad control of through lake lines and canal forwarding 
agencies. —Aside from the elimination of independent carriers, the effects of 
such control which have been most emphasized by witnesses before the com¬ 
mittee are the increase in water rates on through package freight and the fail¬ 
ure to improve the service. In the first place, lake-and-rail and canal-and-lake 
rates have shown a marked advance under railroad control, while the all-rail rates 
between Chicago and New York have remained about constant for the past two 
decades. Because of the slower speed and the larger number of transfers inci¬ 
dent to water transportation, the lake-and-rail rates between Chicago and New 
York, for example, are lower than the all-rail rates between these points by an 
established difference, i. e., a differential which measures approximately the 
difference between the value of the water service and the rail service. The 
present differentials between the two services may be illustrated for the several 
classes of freight as follows: 



Class 1. 

Class 2. 

Class 3. 

Class 4. 

Class 5. 

Class 6. 

WESTBOUND. 







New York to Chicago: 

Cents. 

Cents. 

Cents. 

Cents. 

Cents. 

Cents. 

All rail. 

75 

65 

50 

35 

30 

25 

Rail and lake. 

62 

54 

41 

30 

25 

21 

Differential. 

13 

11 

9 

5 

5 

4 

EASTBOUND. 

Chicago to New York: 







All rail. 

75 

65 

50 

35 

30 

25 

Rail and lake. 

63 

55 

43 

30 

26 

21 

Differential. 

12 

10 

7 

5 

4 

4 

























120 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


“ The above differentials are merely illustrative of the plan in general; 
various differentials have been adopted as between different routes and different 
cities. But what should he particularly noted is that the differentials between 
the all-rail and the lake-aiul-rail rates have in all cases been narrowed, thus 
causing an increase solely in the rates for the lake haul, since the all-rail 
rates have remained constant. While the standard lake-and-rail rates between 
New York and Chicago, for example, were— 

Class 1 
Class 2 
Class 3 

prior to 1901, these were increased in 1901 from 54 to 59 cents on first-class 
freight, and other classes to correspond. In 1907 there was another advance to 
02 cents on first-class freight, and other classes to correspond. Similarly canal- 
and-lake rates from New York to Chicago have also advanced since 1892, as 
follows: 


Cents. Cents. 

_ 54 Class 4_ 27 

_ 47 Class 5_ 23 

_ 37 Class 0_ 20 



Class 1. 

Class 2. 

Class 3. 

Class 4. 

Class 5. 

Class 6. 

In 1S92. 

Cents. 

30 

42 

Cents. 

25 

36 

Cents. 

20 

29 

Cents. 

18 

23 

Cents. 

16 

21 

Cents. 

14 

18 

At present. 



“ These increases in the through water rates, while the all-rail rates have 
remained nominally constant, have, it was argued by the witnesses before the 
committee, made the differential between the lake-and-rail and all-rail rates 
so small that the freight will move by rail. The inducement to use the water- 
route, it is argued, is economy ; and if the differential between the two rates 
just measures the disadvantages of the water route, the railroads will get the 
business, because, all things considered, the railroad service is preferred. Under 
such conditions, it is argued, the value of the water line as a regulator of rail 
rates disappears. Mr. William M. Hopkins in his testimony emphasized the 
point that the reduction of the difference between the all-rail and the lake-and- 
rail first-class rate between 1901 and 1913 from 21 to 13 cents, and correspond¬ 
ingly on other classes, has been brought about, not by a reduction of the all¬ 
rail rate, but by an advance wholly on the lake transportation portion of the 
through rate. (Vol. 2, p. 1225). 

“ Mr. Julius H. Barnes, of Duluth, emphasized the same point in his testimony, 
stating that whereas ‘ in 1890 the lake-and-rail rate on flour from Minneapolis 
to New York was 20 cents and the rail rate 25 cents, and all flour moved 
lake-and-rail, they have since advanced the lake rate until the difference to-day 
is between 23 and 25, instead of 20 and 25, and that is just the dividing line 
where they are giving just enough to the Lakes to make a bluff at water 
transportation. If it was necessary, they would raise it to 24 as against 25, 
and they can do that, in my judgment.’ (Vol. 2, p. 843.) 

“ To the foregoing it may be added, as already indicated, that the lake lines 
have arrangements for through routing and division of rates with the railroad 
lines, as shown in tariffs filed with the Interstate Commerce Commission, and 
the division received by the railroads for their haul east of Buffalo on traffic 
moving via the lake-and-rail route are substantially the same as the divisions 
they receive for the same haul on similar traffic moving via all-rail routes. 

“ Not only has freight destined to the East been diverted from the Lakes 
through the narrowing of the differential between the lake-and-rail and all-rail 
rates, but the railroads have had no incentive to improve their water-line serv¬ 
ice, their policy in this respect being entirely different from that pursued by the 
bulk carriers. Mr. Barnes testified that— 

“ ‘ Package freight lines are loading and unloading merchandise on the Lakes 
the same to-day as they did 40 years ago. Absolutely nothing has been done 
in the way of installing mechanical devices to cheapen the transshipping of 
package freight. It has been to the interest of the railroads to maintain the 
old-fashioned gangway style of steamers, in which freight must be taken on 
and off over the side of the boat on trucks. The small derrick arranged for 
some classes of freight, such as flour and mill stuffs, which would lift the 
freight directly from the cargo hold out on the docks, would cheapen the trans- 



















WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 121 


shipping charge, but as long as it originates on the railroads and is controlled 
by them, it is in their power to say to whom they will give it and they will not 
share it with any individual carrier that might offer.’ (Vol. 2, pp. 841-842.)” 

On page 336 we quote: 

“ The situation as outlined for the movement of package freight does not 
apply in the case of bulk products such as grain, iron ore, and coal, except that 
in the case of grain the rail carriers, as already pointed out, do exercise a large 
measure of control over the rates of water transportation’ by reason of their 
control of the terminal facilities and the connecting rail transportation beyond 
the Lakes. In the main this bulk freight is handled by so-called independent 
tramp steamers whose port-to-port rates are fixed without reference to rail 
transportation. As a result conditions in this field have shown a tendency 
decidedly favorable to the utilization of America’s leading waterway as a chief 
means of transportation; in fact, the entire development in the bulk traffic 
has been the exact opposite of the tendencies noted in connection with the 
movement of package freight by railroad-owned boat lines. This class of 
freight traffic has had the advantage not only of an improved type of steamer 
of large carrying capacity, but improved machinery has been installed at both 
ends of the trip for the expeditious handling of iron ore and coal at a cost of 
only a few cents a ton (vol. 2, p. 844), thus greatly reducing the cost offloading 
and unloading and saving the boats much time.” 

On page 337 we quote: 

“ Despite the favorable tendencies noted in the preceding section, it should 
be stated that there has been a marked tendency during recent years toward 
consolidations among bulk carriers transporting ore and grain eastbound, and 
coal westbound on the Lakes. The eight largest of these consolidations deserve 
special mention, and the essential facts with reference to each, as reported 
to the committee by the managements of the companies involved, are herewith 
presented.” 

On pages 403, 404, and 405 is given a summary of the railway control and 
ownership of the coastwise and Great Lakes shipping, and on page 406 we quote 
with reference to the situation on inland rivers, bays, and canals: 

“ Much the same situation as was noted in the coastwise and Great Lakes 
trade also exists on inland rivers, bays, and canals. Despite the continued 
improvement of waterway and the great increase of traffic in the coastwise 
and Great Lakes trade, ‘the total river traffic of the country has steadily 
decreased both proportionately and absolutely, with the result that few rivers 
are used to anything approaching their full capacity.’ While, generally speak¬ 
ing, the decline of navigation lines on inland waterways is largely traceable 
to the natural extension and legitimate competition of the railroads, there is 
ample evidence to show that the railroads have successfully opposed the main¬ 
tenance and development of river and canal traffic by a variety of effective 
methods, mainly by acquiring competitive water lines and canals, by obtaining 
control of the terminal facilities, by the use of rebates, or by the undercutting 
of rates. Aside from the acquisition of competing lines, the undercutting of 
rates seems to have been the favorite method adopted by railroads to eliminate 
water competitors. Since the railroads reach all sections of the interior, and 
the inland navigation lines are restricted to their water course, they can 
easily control so large a proportion of the total freight as to leave the water 
lines insufficient freight to maintain proper terminals and an efficient service. 
As reported by the Inland Waterways Commission: 

“ ‘ So large a portion of railway traffic is free from water competition that 
railways can readily afford to so reduce rates on those portions affected by such 
competition as to destroy the profits of the water lines without appreciably 
affecting the profits of the rail system, which recoup there reductions by higher 
rates elsewhere. This has been the case with most of the great inland water- 
ways, excepting the Great Lakes, where the conditions of water and traffic 
approach those of the open sea.’ 

“ This method of eliminating water competition is well illustrated by the 
experience of water lines on the Mississippi River system. On this system 
packet line services have largely disappeared, owing to railroad competition, 
and the few lines remaining, while generally independent of railroad control, 
are but weak competitors. Effective railroad opposition to independent water 
lines also exists on the Nation’s other leading rivers, such as the Columbia 
and Hudson. 

“ Most of the canals of the country have also long since passed into the hands 
of competing railroads. Almost invariably, following the acquisition of the 


122 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


canals, the railroads failed to maintain the efficiency of the same for trans¬ 
portation purposes or raised the tolls so high as to preclude their use, or 
entirely abandoned the property. In some instances, however, the decrease or 
practical disappearance of canal traffic is traceable to the antiquated character 
of the canal, and in all likelihood most of the privately owned canals would by 
this time have ceased to be an efficient means of transportation, even though 
they had not been acquired or controlled by the railroads. Even the most 
important State carnal—the Erie Canal—as already shown, is so completely 
dominated by the railroads, as far as through traffic is concerned, that the move¬ 
ment of freight originating outside of the State of New York via this route 
has almost reached the vanishing point. Not only do the railroads own all the 
through Lake freight lines centering at Buffalo, but they control practically all 
the terminal facilities at both ends of the canal as well as the forwarding 
agencies and boat owners. At present about 90 per cent of the mileage of the 
private canals still in operation is under railroad control.” 

RECOMMENDATIONS OF THE COMMITTEE. 

The committee, after referring to the extent to which waterway competition 
has been eliminated (p. 415), say: 

“ The act of August 24, 1912, providing for the opening, maintenance, pro¬ 
tection, and operation of the Panama Canal, contains provisions extending the 
jurisdiction of the Interstate Commerce Commission over the interstate trans¬ 
portation which involves the carriage of property by rail and water, in the 
following particulars, viz, (1) to establish physical connection, where this is 
reasonably practicable and justifiable, between the rail carrier and the dock of 
the water carried by directing either or both of the carriers to construct the con¬ 
necting tracks; (2) ‘to establish through routes and maximum joint rates 
over such rail and water lines, and to determine all the terms and conditions 
under which such lines shall be operated in the handling of the traffic em¬ 
braced ’; and (3) ‘to establish maximum proportional rates by rail to and 
from the ports to which the traffic is brought, or from which it is taken 
by the water carrier, and to determine what traffic and in connection 
with what vessels and upon what terms and conditions such rates will 
apply.’ Section 11 of the act also provides for the divorcing of common 
carriers by water from the railroads under certain conditions. These legis¬ 
lative requirements go far toward eliminating some of the undesirable 
practices which were found by the committee to exist in the domestic com¬ 
merce of the United States. The committee, however, believes, in view of the 
facts presented in Part II of the report, that additional legislation is required, 
and wishes to offer the following recommendations: 

“ (1) That the jurisdiction of the Interstate Commerce Commission be ex¬ 
tended to the interstate port-to-port traffic of domestic water carriers, with 
full pqwer to require all such carriers to file their port-to-port rates and to sub¬ 
mit reports of their financial and business operations. As regards interstate 
port-to-port traffic the commission should be given full power to regulate rates 
and to determine maximum charges. 

“ (2) That water carriers be required to file for approval with the Interstate 
Commerce Commission all agreements affecting interstate transportation, 
whether written or oral, and all modifications or cancellations thereof, with 
other water carriers, with railroads or other transportation agencies, or with 
shippers. 

“ (3) That the carriers be prohibited from granting rebates of any kind to 
shippers and from discriminating between shippers in rates, in the giving of 
space accommodations and other facilities, and in the making of unfair con¬ 
tracts based on the volume of freight offered. Water carriers should also be 
prohibited from using figliting ships, or deferred rebates, or from threatening 
or resorting to retaliatory or other unfair measures against shippers or com¬ 
petitors. The Interstate Commerce Commission should be empowered to adopt 
whatever measures it may consider necessary to protect shippers or competitors 
against such retaliatory methods. Water carriers, if cutting rates with a view 
to driving out a competitor, should be denied the privilege of restoring rates; 
and jurisdiction should be conferred on the Interstate Commerce Commission 
to determine whether rates were cut with the object of crushing such com¬ 
petitor. 

“ (4) That the Interstate Commerce Commission be empowered to investigate 
fully all complaints charging unfairness in the settlement of claims, and in- 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 123 


difference to tlie loading and landing of freight in proper condition; and to 
adopt all necessary rules and regulations for the adjustment and settlement 
of claims. 

“(5) That as regards all matters relating to interstate transportation, all 
traffic associations or conferences, whether pertaining to through rail-and-water 
transportation or to port-to-port traffic only, be brought under the supervision 
of the Interstate Commerce Commission. The committee recommends that the 
conditions under which an outside water carrier is admitted to such associations 
or conferences should be approved by the commission, and that an outside line 
should not be denied membership for unfair reasons or simply because the 
unanimous consent of existing members of the association or conference to the 
admission of said line can not be obtained. 

“(G) That the railroads be prohibited from making the through rail-and-water 
route unprofitable as compared with the all-rail route by charging more for the 
same service on water-borne commodities than they charge for the proportionate 
share of the all-rail haul. 

“(7) That the Interstate Commerce Commission be empowered to compel rail¬ 
roads to allow competitive water carriers to apply effective differentials. The 
commission should also have full supervisory power over divisions between rail¬ 
roads and water carriers as regards through rail-and-water rates. The com¬ 
mittee recommends that rate divisions on any trade route should be opened 
equally to all water carriers that comply with such conditions of quality and 
regularity of service as the commission may determine to be reasonable. 

“(8) That the railroads and water carriers be required to issue through bills 
of lading to all interstate water carriers that meet such conditions of quality 
and regularity of service as the Interstate Commerce Commission may consider 
reasonable. 

“(9) That railroads be required to account separately to the Interstate Com¬ 
merce Commisssion for the income and expenditures of interstate water lines 
owned or controlled by them. * 

“(10) That railroads be required to make their terminal facilities available 
to water carriers on equal terms and under such reasonable conditions as the 
Interstate Commerce Commission may prescribe. The committee also believes 
that the Federal Government should pursue a policy of not expending money in 
the interests of any port for harbor or channel improvements unless that port 
has efficient dock facilities available to all water carriers. 

“(11) That there should be legislation providing for equal treatment to all 
shippers and water carriers by transfer and lighterage concerns when forming 
a link in interstate or foreign commerce. 

“(12) That all interstate traffic on canals be placed under the supervision of 
the Interstate Commerce Commission, and that the railroads be prohibited in 
the future from acquiring, either directly or indirectly, ownership and control of 
or interest in canals, or water lines, forwarding companies, and other naviga¬ 
tion facilities on such canals when the same are used in interstate transporta¬ 
tion.” 

18. From the foregoing it seems to be perfectly clear that the railroads have 
succeeded to a very large extent in monopolizing transportation not only upon 
the railways but upon the waterways and canals to such an extent that they 
control through freight rates by water, leaving to independent carriers only 
that small fraction of the entire traffic to be had in port-to-port traffic even as 
to which the independent water carrier is entirely at the mercy of its railway- 
controlled competitor who has the great advantage of traffic with railways, pro¬ 
rating arrangements, etc., on the profit of which the railway-controlled carrier 
can exist and carry port-to-port traffic at any rates fixed by the railway- 
controlled water carrier. The control of terminals, warehouses, docks, loading 
and unloading facilities, etc., enables the railway combination owning and con¬ 
trolling railway terminals, and lake and water carriers to offer advantages in 
the way of free storage or rates which include or absorb terminal and handling 
charges and transfers from rail to boat and boat to rail at such a decided advan¬ 
tage that under present conditions the independent canal boat or water carrier 
can not exist except at the pleasure of the railway combination or monopoly. 
The question is, Must it be assumed that the foregoing conditions are uncon¬ 
trollable and that such conditions are to indefinitely continue? Should it not 
be assumed that the evils of unrestrained railway competition resulting in 
monopoly of transportation by water and rail and enormous losses annually to 
the consuming public can and will be reached by legislation and by other orderly 
and legal methods? 


124 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Must it not be assumed that public opinion aroused by the several reports of 
congressional bodies and other authority upon the subject will in thunderous 
tone voice a demand which will be so powerful as to result in the needed legis¬ 
lation being promptly enacted? 

19. So far as local legislation is concerned, with reference to placing owner¬ 
ship and control of terminals in the public authorities of the States of Minne¬ 
sota and Wisconsin, and providing for the use of the proposed canal adequate 
terminals equipped with the most modern terminal facilities, we have no hesi¬ 
tation in pledging that the same would be provided by the localities interested 
in the promotion of this enterprise and if upon a review of the report of the 
local board the existence of hostile railway control or want of adequate termi¬ 
nals and terminal facilities without discrimination were deemed to be material 
to the success of the canal the proponents of the canal would welcome the condi¬ 
tional approval of the general board, i. e., conditioned upon the removal of the 
adverse conditions found to exist with reference to hostile railway monopoly 
and absence of terminals and terminal facilities. 

HISTORY OF HOSTILE RAILWAY COMPETITION. 

The local board of engineers make the claim that current history shows that 
unless there is sufficient tonnage available to be transported by the canal at the 
present time such tonnage will not increase but on the contrary will decrease. 
It is partly in this connection that the local board cites the decline of traffic on 
the Ohio River, Mississippi River, Erie Canal, etc. 

We are glad to invoke the authority of history with reference to the causes 
of the decline in the water-borne traffic in the United States. The history of 
waterway transportation is much the same whether we examine the history of 
waterways in Europe or in the United States. We believe a study of the history 
of waterway transportation in Europe and in America will convince the un¬ 
biased reader that the history of waterways in Europe is now being duplicated 
in the United States; that the rise and decline of waterway transportation in 
the United States was caused by identically the same factors which caused the 
former decline of waterways in Europe. We think the same causes that con¬ 
tributed to the resurrection and rehabilitation of waterways in Europe are now 
at work in America and will cause a like development of waterway traffic in the 
United States, and that there is now commencing in the United States a great 
revival of waterway transportation similar to that which is so plainly in evi¬ 
dence in Europe. 

Authorities on the history of inland water transportation divide its history 
into three periods (see p. 471 et. seq. Final Report National Waterways Com¬ 
mission) : 

First. The period which began with the sixteenth century in Europe and 
shortly after the close of the Revolutionary War in America, and extended to 
the time of commencement of railroad building. 

Second. Tbe period of active competition with railroads resulting in decline 
and decadence of waterways. 

Third. The period which began in France, Germany, and Belgium as early as 
1S70 and which is characterized by tbe great revival of water transportation. 

The first period was essentially one of canal building and commenced in 
Europe in the seventeenth century. Practically all of the canals of France, 
Holland, and Belgium were completed before the year 1800. 

In England active canal building began with the opening of the Bridgewater 
Canal in 1761. This enterprise was a great success and created a boom for 
canal construction. By tbe year 1800 practically tbe whole of the English canal 
system, aggregating more than a thousand miles, was completed. A few addi¬ 
tions were made between 1800 and 1830, but since 1830 no important canals 
have been constructed except tbe Manchester Canal. 

Canal building in the United States began a short time after the close of the 
Revolutionary War. Washington was one of the pioneers in the movement. The 
most rapid construction commenced about 1825 when the Erie Canal was com¬ 
pleted. It was a great success and aroused great enthusiasm for canal building. 
Most of tbe canals of New York, Ohio, Pennsylvania, New Jersey, and other 
eastern States were completed before 1850. 

Canals constructed in Europe during the first period were usually of small 
capacity. The majority of English canals had a depth of only 31 feet; 35 per 
cent of the total canal mileage of England would only accommodate boats 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER, 125 


carrying from 18 to 30 tons, 58 per cent of boats carrying from 40 to 60 tons, 
and only 7 per cent would accommodate boats of greater capacity. 

The early canals in the United States were also shallow draft and equipped 
with numerous locks and sometimes incline planes. The Morris Canal was 
originally only 4 feet in depth and accommodated boats of less than 40 tons 
capacity. 

Although the canals of the first period as a rule were scarcely more than 
ditches many of them were very profitable enterprises. Until railroad competi¬ 
tion began they furnished the principal means of transportation and played a 
very important role in the prosperity and development of different countries. 
They appear to have been more profitable in England than elsewhere, their 
profits being greater than those of the railways have ever been. Many of the 
canals in the United States were exceedingly profitable. The Schuylkill navi¬ 
gation during the period of 1829-1842 paid dividends ranging from 9 to 24 per 
cent. The Erie Canal up to and including 1882 had returned to the State of 
New York $42,599,718 profits on an investment of $49,591,853. Other eastern 
canals were highly profitable. 

The period of railroad building commenced about 1830. Within 10 years in 
Europe competition between railways and waterways became severe. This con¬ 
tinued for the next 30 or 40 years, at the end of which time the waterways were 
generally left in a decadent condition. At first the railroads often intersected 
the waterways and served as feeders. As soon as parallel lines were built active 
competition began. Passenger traffic was the first to drop off, then higher grade 
freight, and finally, when the railroads had consolidated sufficiently to form 
through routes so as to serve a large territory in addition to that adjacent to 
the banks of the canal, they offered cheaper rates and secured most of the 
coarse, bulky traffic carried by the waterways. One great weakness of the canal 
system was that they were owned and controlled by various private companies 
in short sections and they failed to amalgamate or consolidate so as to unite 
their strength and furnish facilities for through traffic. The railways uniformly 
adopted the policy of consolidation and amalgamation, thus extending their ter¬ 
ritory and ability to handle through traffic, at the same time gaining the ad¬ 
vantage naturally accruing to large combinations. 

In England, when the shareholders of canals saw their profits dwindling, 
they procured the consent of Parliament for the purchase of various canals by 
the railways, and within live years after active competition commenced, about 
1845, one-third of the total canal mileage fell into the hands of the railway 
companies. Part of the canals so acquired were used as roadbeds for new 
railway lines or abandoned; others were used for feeders, and almost all of 
the traffic declined rapidly as the result of railroad control or competition. 

Railway competition in the United States commenced in 1842 between the 
Reading Railroad and the Schuylkill navigation. It was severe until 1849, 
when the railroad and canal entered into an agreement as to charges, and in 

1879 the canal was leased to the railroad for 999 years. The history of the 
Schuylkill navigation was repeated with the Lehigh Canal, which was sold to 
the Lehigh Valley Railroad, and in a few years practically all of the private 
canal companies in New York, Pennsylvania, and New Jersey passed into the 
hands of their railway competitors. New York and Ohio retain their publicly 
owned canals. As we have heretofore seen, the leasing or selling of a canal to 
a railroad meant its practical and ultimate abandonment. 

In the Mississippi Valley and the South severe competition between rail¬ 
ways and waterways did not begin until after the Civil War, when the short 
railway lines were amalgamated into through routes. The improvement of 
rivers by Federal Government enabled waterways to compete successfully for 
a time, but the commerce of the Mississippi River reached its maximum from 

1880 to 1884, since which time there has been a considerable decline. Some of 
the western rivers have not experienced railway competition and their traffic 
has steadily increased. Wherever railway competition has been encountered 
almost without exception a marked decline in river and canal commerce has 
ensued. In Europe, including England, interest began to be aroused in water 
transportation in the sixties and seventies. This was due to the same causes 
now operating in this country, viz, a growing hostility toward railroads brought 
about by discriminations, high rates, lack of service, and congestion of traffic. 
The result of the agitation in Europe has been a practical nationalization of 
waterways in France, Germany, Belgium, and Holland, which countries have 
acquired practically all of the canals and waterways. The first step in the 


126 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


revival of water transportation in Europe was the standardization of canals and 
waterways as to depths, locks, etc., the old methods of towage by mule or other 
power being supplanted by steamers or electric tractors. Terminals were built 
and equipped with the latest appliances and better types of boats and barges 
are being used. 

Growth of water transportation in Germany, France, and Belgium during 
the last 40 years has been phenomenal; from 1875 to 1909 traffic on the German 
waterways increased 433 per cent; from 1880 to 1909 traffic on the French 
waterways increased over 90 per cent; and in Belgium during the years 1890- 
1907 the traffic on inland waterways increased 115 per cent. The following 
table shows the growth of traffic in these three countries: 


Year. 

Germany. 

France. 

Belgium. 

1875. 

Tons. 

13,000,000 

Tons. 

Tons. 

1880. 

18,000,000 
24,107,000 
27,174,000 
32,440,000 
34,030,000 
34,702,000 
35,624,000 


1890. 


25,242,000 
30,142,000 
38,178,000 
53,345,000 
54,164,000 

1895. 

30,000,000 
46,000,000 
67,000,000 

1900. 

1905 

1907. 

1909. 

73,357,000 




Russia reports 100 per cent increase in the last 10 years. 

In Germany, at several of the largest inland cities, the receipts and ship¬ 
ments by water nearly equal those by rail. Since 18S5 the waterways center¬ 
ing at Berlin carried from 40 to 50 per cent of the total receipts and shipments; 
at Hamburg the receipts by river are nearly equal to those by rail. 

England is the only one of the more advanced European countries in which 
inland waterway transportation is still in a backward condition. The canals 
there were originally built by private interests and are still under private 
control. The different canals still remain disconnected arid under a multi¬ 
plicity of authority split up into short sections owned by different companies or 
persons. Very few waterways have been enlarged or improved to meet modern 
conditions; almost all through routes are blocked by railroad control by one 
or more important links. Not one of the 19 different through routes in England 
and Wales is controlled by a single body. On three routes connecting London 
and Liverpool there are 26 different authorities. On the four routes between 
London and Bristol there are 27 different authorities. On the route between 
Holland-Bristol the boat must traverse 10 different routes with gauges vary¬ 
ing from 50 by 14 by 4.6 feet to 212 by 22 by 9.6 feet. Since 1870 there has 
been a gradual revival of interest in waterways in England which has led to 
considerable agitation, parliamentary inquiries, and some legislation having 
for its purpose the protection of canals and waterways from unreasonable, 
unrestrained, and unfair competition, ownership, and control, but up to the 
present time, owing to the opposition of railways in England, there have been 
no considerable results in the revival of water transportation. 

The history of waterways in the United States is a duplication of continental 
European history of the same subject up to the year 1870. Canal and waterway 
transportation in Europe were destroyed by railway interests by practically the 
same means employed here, as shown in the foregoing reports, and with the 
same results. Waterway transportation in Europe was revived by Gov¬ 
ernment protection of waterways from the hostility and competition of railways. 
It will be necessary to employ the same means in the United States to bring 
about the same result shown to have followed from the governmental policy in 
Europe. There has been a growing agitation for improvement of waterways in 
the United States for 12 or 15 years past. This has been especially prominent 
since the congestion of traffic which occurred in 1906-7, when the railway 
failed to furnish sufficient accommodations to take care of the enormous traffic. 
The agitation in this country, as in Europe, is based upon the fundamental 
and economic necessity of cheaper and more adequate transportation facilities. 
The United States possesses better natural waterways than any country in the 
world and it is evident that natural conditions have not been responsible for 
the decline of water-borne traffic in this country. It is conceded and is apparent 
from the reports hereinbefore cited that railway competition has been more 





















WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 127 


severe here than in any of the countries of Europe. The methods used by 
railways to strangle waterways have been and are more vicious and crippling 
in character than any known in the history of continental Europe. So far as 
any argument with reference to the future of waterways in the United States 
can he based upon the history of waterways in general, it would seem to be 
almost conclusively apparent that the waterways of the United States, if freed 
from the artificial conditions created and fostered by hostile railway interests 
and adequately protected by the Government from destructive railway com¬ 
petition, would be revived and restored and would carry a large percentage 
of the bulky freight of this country naturally tributary to such waterways. If 
proper protective conditions were supplied by governmental action and legisla¬ 
tion, supplemented by proper terminal facilities, physical connection between 
railway and waterway, etc., no reason can be advanced why the waterways of 
the United States should not compare very favorably in increase of traffic with 
the waterways of Europe. 

It appears from the history of European waterways that Germany has the 
best and most efficient waterway system of any known in the world. This is 
shown by the great increase of traffic during the last 40 years, which period 
marks the industrial rise of Germany from a comparatively insignificant nation 
commercially to the foremost place among the nations of the world. She is 
now England’s greatest European rival for commercial supremacy. It appears 
that freight can be transported from the interior of Germany and landed on 
the dock at London as cheap as the same freight can be transported from points 
inland in England distant 50 miles from London. (Final Report National Water¬ 
ways Commission, p. 490.) Leading economists and authorities on commerce 
attribute Germany’s rapid commercial advancement to her magnificent system 
of inland waterways, while England’s comparative commercial decadence is 
likewise attributed to the utter failure of her inland waterway system. It is 
well known that railway rates in England are higher than in any other country 
in the world. The average capitalization of her railway lines is also the highest 
of any in the world, being an average of $275,000 per mile. 

While it may be claimed that conditions in Europe are more favorable to 
waterway transportation than in the United States on account of the greater 
density of population and the enormous quantity of bulk commodities such as 
coal, iron ore, grain, cement, etc., available there, yet the great success of 
revived waterway transportation in Europe is material to this discussion 
because such history clearly shows the necessity of the protection of waterway 
transportation even under the most favorable conditions from unrestrained, 
unregulated railway competition and because it is further shown that the con¬ 
ditions necessary to the favorable development of water transportation in 
Europe and elsewhere exists with reference to the proposed canal from Lake 
Superior to the Mississippi, to wit, the existence of a large amount of available 
bulk tonnage such as coal, iron ore, stone, cement, steel and iron, general 
merchandise, wheat, coarse grain, flour, and other like commodities, together 
with a large population at the terminii and adjacent to the waterway for the 
consumption and manufacture and use of such commodities, in addition to the 
fact that the canal will form a link between the great waterway transportation 
systems from the Atlantic seaboard via Erie Canal, Great Lakes, Mississippi 
River, Gulf of Mexico, and Panama Canal. 

TONNAGE ADDITIONAL TO LOCAL RAIL TRAFFIC OF 1912. 

21. The engineers in their report, as above, considered only estimated actual 
local rail traffic between principal terminals for the fiscal year 1912 as the basis 
for the volume of tonnage which the canal would handle. 

To this, it is obvious, there are vital and important additions to be made, 
including tonnage allowances to meet the following conditions: 

(a) Volume of annual traffic growth of canal zone, including Duluth-Superior 
Harbor and upper Mississippi ports, from 1912, when engineers took local rail 
traffic data to date when canal shall be completed and in operation—say, 1918—- 
period of six years. 

(ft) Volume of traffic developed by canal itself in canal zone, through effect 
of 250 additional miles of transportation facilities afforded, (1) to hitherto 
undeveloped resources, (2) to commerce of existing lake and river terminals 
(8) to existing manufacturing and agricultural industries, (4) to creation of 
new industries, (5) to creation of new commerce between local points, (6) to 


128 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


stimulus of lower and equalized transportation rates, (7) to cooperation be¬ 
tween waterways and railways in developing tributary territory. 

(c) Volume of new tonnage created by opening a through channel of com¬ 
merce between the Government upper Mississippi River project of navigation 
and Great Lakes navigation, thereby opening up navigable route for new com¬ 
merce between North and South, Lakes and Gulf, Panama Canal and Great 
Lakes, and between the upper Mississippi Valley and eastern ports via the Erie 
and Welland Canals. 

(d) Volume of increased farm and mill tonnage in 2S tributary Wisconsin 
and Minnesota counties located partly within canal zone and partly on two 
sides of channel of connecting upper Mississippi navigation project, being the 
river counties of these two States, the United States census value of whose 
farms increased from $240,000,000 in 1900 to $450,000,000 in 1910—an increase 
of $216,000,000, or 90 per cent, in 10 years—and subject to further immediate 
increase in value and tonnage upon development of their chief route of water 
transportation. These 28 counties in 1910 produced 62,000,000 bushels of 
grain, dairy output of 464,000 farm cows, 616,000 bushels of fruit, 1,878,000 
tons of hay, and 13,000,000 bushels of potatoes, which will increase 50 per 
cent by 1918. (See Exhibit 1 hereto attached.) 

(e) Volume of new tonnage developed by United States Government 
$20,000,000 upper Mississippi improvement project, which will create commerce 
and transportation traffic on the upper Mississippi by furnishing 6 feet of mini¬ 
mum low-water depth of channel in place of the former inadequate 4£ feet, 
and by construction of Lake Superior-Mississippi link will project the com¬ 
merce of the Mississippi into a through Lakes-to-the-Gulf channel. 

(/) Volume of new river tonnage at Minneapolis by completion of Govern¬ 
ment high dam across Mississippi in Twin City district extending Mississippi 
River navigation into Minneapolis, to which the city of Minneapolis contributes 
$300,000 for municipal public docks, and to which Minneapolis manufacturers 
and jobbers have recently pledged 1,000,000 tons of new river merchandise 
tonnage. 

(</) Volume of river-borne commerce that will be developed by completion of 
Panama Canal, extending Pacific Ocean commerce into Mississippi Valley, and 
by completion of the Lake Superior-Mississippi project extending such com¬ 
merce into the Great Lakes. 

(h) Volume of lake-canal-river commerce that will be developed by new 
$130,000,000 Erie Barge Canal and public terminals, the purpose of which is to 
secure the grain and flour tonnage of the upper Mississippi and Great Lakes 
region for New York Harbor in exchange for merchandise to be shipped from 
New York to the Northwest. 

( i ) Volume of new tonnage that will be produced by the 48 iron and steel 
mills, furnaces, coke ovens, cement works, and auxiliary plants of the Minnesota 
Steel Co. at Duluth, which occupy 2 miles of water front on the Duluth-Superior 
Harbor and will probably be in operation next year for conversion of the prod¬ 
uct of Minnesota iron mines into finished products for upper Mississippi Valley 
supply. This plant will also invite return cargoes from upper Mississippi and 
St. Croix Valleys of limestone for furnaces and cement works, brick and stone 
for construction work, and farm and mill produce for supply of Duluth-Superior 
mill, mine, and dock population. This company, which is a subsidiary of United 
States Steel, will likewise supply the American Bridge Co., another United 
States Steel subsidiary, with structural steel for its plants at Minneapolis, St. 
Louis, and other Mississippi River distributing points and for the new ware¬ 
house which it is building at St. Paul. 

(j) Volume of increased coal tonnage of extensive new coal-handling plants 
now building at Duluth-Superior Harbor giving that harbor 20,000,000 tons of 
lake coal-handling capacity, with probable coal receipts for 1918 double those of 
1912, and serving the double purpose of giving the lake iron-ore fleet return car¬ 
goes from Lake Erie and the upper Mississippi Valley high-grade Pittsburgh coal 
for the development of its manufacturing industries and for domestic consump¬ 
tion. 

(k) Largely increased volume of products of general manufacture both in 
canal zone and all manufacturing centers of upper Mississippi Valley as result¬ 
ant of following factors: 

(l) Direct and indirect influence of Duluth-Superior steel and coal expansion 
with supplies of cheap and near-at-hand materials for hundreds of auxiliary 
manufacturing enterprises throughout the Northwest. 


WATERWAY EROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 129 


(2) New water-power developments on Mississippi, St. Croix, St. Louis, and 
Rainy Rivers and tributaries. 

(3) Development of new hardwood, pulp wood, stone, and brick resources of 
upper St. Croix Valley. 

(4) Addition of 250 miles of waterway transportation facilities at reduced 
rates, in conjunction with completion of Panama, Erie Barge, and Welland 
Ship Canals and $20,000,000 Mississippi River improvements, is logical fore¬ 
runner of largely increased industrial tonnage. 

SUMMARY OF ADDED TONNAGE OVER AND ABOVE 1912 LOCAL RAIL TRAFFIC. 

22. First. Completion of industrial and transportation projects now in prog¬ 
ress, directly or otherwise materially affecting Lake Superior and Mississippi 
River commerce and connecting canal zone, will reasonably produce by 1918 a 
traffic volume that will tax all available transportation facilities—rail, canal, 
and river. 

Second. During six-year period, 1912-1918, normal development of industrial 
and commercial territory, including demands of new population and settlement 
and opening of lands, forests, mines, and starting of new towns and enterprises, 
require substantial addition to 1912 transportation facilities. 

Third. Transportation routes, whether railway, highway, or waterway, are 
built on the basis, not of the commerce which actually passes before they exist, 
but of the commerce which reasonably will be developed as the result of their 
construction and operation in conjunction with other connecting routes working 
in cooperation for the development of resources. 

Fourth. Chief among the considerations for opening a new route are its rela¬ 
tions to other routes and its effect upon the success of connecting projects; and 
the principal commerce which the proposed project should develop is through 
tonnage as a link between the three greatest waterway projects of the United 
States Government, namely: 

( a ) Mississippi River, for which total expenditures, appropriations, and 
estimates for improvements in progress represent a prospective aggregate 
investment of $180,000,000—but without through channel of commerce. 

( b ) Great Lakes system, representing heavy investment for harbor and 
canal improvements, resulting in development of the principal volume of 
American water-borne commerce—80,000,000 tons of freight yearly at esti¬ 
mated value of $900,000,000—and yet without through channel. 

(c) Panama Canal, representing ultimate investment of $375,000,000, its 
principal benefit to industrial interior depending upon Mississippi River and 
Great Lakes connections. 

PROBLEM OF COMMERCIAL FEASIBILITY. 

23. It will be admitted that the prospective tonnage demands of the canal 
zone and country tributary by the time the project can be completed and 
placed in operation will tax the railroads to full and yearly increasing ca¬ 
pacity, as well as the river and proposed canal link working in cooperation, so 
far as volume of available tonnage is concerned. This resolves the question 
of commercial feasibility of proposed lake-to-river canal link to the one point, 
namely—the ability of the canal-and-river barge working on 6 feet minimum 
navigable depth of waterway to handle its due share of tonnage in competi¬ 
tion with, or rather, in cooperation with, the box car. 

ERIE CANAL RATE. 

The comparative cost of transportation being a prime factor in the ability of 
the canal barge to secure and hold business, the engineers properly sought a 
standard rate for such waterway for comparison with the present rail rate 
and decided that the Erie Canal rate offers such a standard. Under normal 
conditions the Erie rate would be a fair standard of comparison, but we sub¬ 
mit it is manifestly unfair to offer the Erie rate as a standard for compari¬ 
son with proposed canal, because the Erie Canal has not been operated since 
1885, except under decidedly adverse conditions tending to divert traffic from 
canal to rail and to increase costs of canal transportation. The adverse and 
abnormal conditions present on the Erie Canal during the entire period of 
comparison can and will be prevented from operating to the detriment of the 


H. Doc. 1008, 64-1-9 



130 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER, 


proposed canal. The hostile and adverse conditions which prevented the 
normal development of traffic on the Erie Canal have been fully described in 
the reports of the Inland Waterway Commission, National Waterway Com¬ 
mission, and report of the House Committee on Merchant Marine, from which 
we have heretofore freely quoted and embraced the following almost wholly 
and artificial and preventable adverse conditions: 

(1) Ownership by railways of docks, terminals, elevators, loading and un¬ 
loading facilities at Buffalo, New York, and other points along the canal and 
consequent control of charges for use thereof. 

(2) Railway control of canal-boat lines and freight-forwarding agencies. 

(3) Ownership of lines of vessels operating on the Great Lakes. 

(4) Agreements between owners of rail lines east of Buffalo and New 
York and west of Duluth and Chicago. 

(5) Discrimination against canal traffic aided by ownership and control of 
the foregoing agencies, all operating together to divert traffic from canal to 
rail, including refusal to make equitable through canal, lake and rail rates or 
divide such rates on any equitable basis; refusal of rail lines and vessels 
controlled by railways to carry freight from canal except at high local dis¬ 
criminating rates; refusal of rail or lake carriers controlled by railways to 
deliver freight to canal boats except canal boats owned or controlled by rail¬ 
ways ; refusal to permit independent canal boats to use docks, terminals, ele¬ 
vators, etc., except at high and discriminating rates or upon conditions giving 
railways absolute control of traffic on canal. 

The effect of all the foregoing adverse conditions was to prevent improve¬ 
ment in type of canal boats, great loss of traffic on canal generally, failure to 
repair or keep up depth of canal, and altogether would have resulted in total 
abandonment of canal, except that the people of New York becoming aroused 
to threatened destruction of cheaper waterway transportation determined to 
rebuild canal and rehabilitate and restore canal commerce. 

Under the circumstances the Erie Canal rate standard should be considerably 
discounted. 

The information of the local board is, that the average Erie Canal rate 
is 3 mills per ton per mile; which would make the total freight charge for the 
260-mile haul from Duluth to Minneapolis via proposed waterway 78 cents 
a ton. 

Consensus of Erie Canal authority, however, appears to indicate that the 
Erie rate during the past 20 years, even under adverse conditions, is approxi¬ 
mately 2 mills per ton-mile, and that modern methods and efficient administra¬ 
tion devoid of hostile control would have materially reduced this average, 
even on the old canal and ancient-type boats, now practically abandoned to 
make way for the new barge canal which is nearing completion. 

As the difference between 2 mills and 3 mills makes 25 cents per ton on 
the 250-mile haul, and therefore is material to the question of commercial 
feasibility, we take the liberty herewith to introduce authorities: 

( a) Hon. A. Barton Hepburn (former Comptroller of Currency, president 
Chase National Bank, member New York Chamber of Commerce) on page 
104 of Artificial Waterways and Commercial Advancement (Macmillan Co., 
1909) publishes average New York canal and railway rates for 15-year period, 
1903-1907 inclusive, as follows: 


Average ton-mile rate. 


5-year period. 

Canal 

rate. 

Railway 

rate. 

1893-1897. 

Mills. 

2.0 

1.9 

2.0 

Mills. 

6.2 

5.8 

6.3 

1898-1902. 

1903-1907. 



Fifteen-year average as found by Mr. Hepburn was 2 mills per ton-mile 
by canal, compared with 6.1 mills by rail; average 15-year by canal being 
one-third of rail rate. This canal rate was made by small old-type wooden canal 
boat. Engineering data was given showing that by modern methods the 
240-ton boat could carry freight at 1.75 mills per ton-mile; while a 320-ton 
boat would reduce the rate to 1.16 mills, and 450-ton barge to 0.88 of 1 mill. 











WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 131 


Mr. Hepburn deplored neglect of canal, which found “yearly expression in the 
loss of commerce to the city of New York,” and charged railroad influences 
as “largely responsible for the inefficient canal policy of the State.” Mr. 
Hepburn derived his information from New York canal commissions and 
engineers specially designated to secure reliable expert data. His high 
financial and business standing, both in city and nation, render him an author¬ 
ity in the field covered by his volume. 

(&) United States Bureau of Railway Economics, 1911, quotes Erie Canal 
rate as 2 mills per ton-mile. 

(c) United States Inland Waterways Commission (Government Printing 
Office, 1908, p. 238, quoting United States Statistical Abstract and reports of 
United States Department of Agriculture), publishes average annual canal and 
rail rates in New York for period of years, from which the following data for 
1895-1905 are in comparative agreement with data of Mr. Hepburn: 

Average railroad and canal freight rates per ton mile} 


Year. 

New York 
Central 

R. R. 

New York 
canals. 

Year. 

New York 
Central 

R. R. 

New York 
canals. 

1S95. 

Mills. 

7.26 
6.68 
6. 79 
6.10 
6.90 
5.60 

Mills. 

1.50 

2.50 
1.90 
1.90 
1.90 
1.70 

1901 . 

Mills. 

Mills. 
2.30 
2. 50 
2.70 
2.10 
2.60 

18%. 

1902 

6.30 
6.40 
6.60 
6.10 

1897. 

1903 .... 

1898. 

1904 . 

1899. 

1905 

1900. 

Average 1895-1905.. 

6.37 

2.14 



* Wheat is the commodity chiefly used as a basis, and for the haul over the Erie Canal and river from 
Buffalo to New York. 


During five years of the above period the rate was below 2 mills per ton-mile, 
ranging from 1.5 to 1.9 mills. Grain over the Erie is carried in the old wooden 
240-ton barges of ancient type; whereas the proposed Lake Superior-Mississippi 
Canal will accommodate 550-ton barges. From 1901 on the Erie Canal the 
equipment was allowed to fall into neglect because the State was starting 
upon a new project which called for new and larger type barges; so that from 
1901 to date the canal traffic passed largely into the hands of the railroad 
companies at increasing rates. It will be noted, however, that with all these 
handicaps the canal carried the freight at one-third the rail rate. 

(d) The movement for the rehabilitation of the Erie and other New York 
canals took head under the administration of Gov. Theodore Roosevelt in the 
appointment of a State canal commission to investigate commerce and canals. 
The New York Produce Exchange and Chamber of Commerce took leadership 
in this movement with a view of restoring to New York its commerce with the 
West; New York grain receipts, including flour, having fallen off upward of 
75,000,000 bushels. Through railroad control and neglect, New York grain 
receipts on the Erie Canal fell off in 25 years 50,000,000 bushels. In its report 
of 1901 (p. 9) the New York Canal Commission described the rate and the 
conditions on the Erie Canal as follows: 

“ On the canals of New York, where the boats are very small, the waterways 
greatly restricted, and obsolete methods are employed for handling business, it 
is about 2 mills per ton-mile.” 

(e) National Waterways Commission, in final report of 1912 (p. 574), says 
of the Erie Canal rate: 

“ The committee on canals in New York State in 1899 estimated that freight 
could be conveyed on the Erie Canal for 1.75 mills per ton-mile even after 
making allowance for the fact that a boat could only make seven trips during 
the season of navigation, and traveled one Vay with only a third of a load. 
As a matter of practice, the cost has averaged more than 2.45 mills, or an 
increase of 40 per cent, due to the lack of ideal conditions.” 

(/) Perhaps the most elaborate detailed engineering estimate of Erie Canal 
cost of transportation was that of Maj. Thomas W. Symonds, Corps of Engi¬ 
neers, which was made under the auspices of the New York Canal Commission. 
The report discusses condition and capacity of channel, type, capacity, speed 
and cost of canal boat, handling and cargoes of tow fleet, number of trips per 



























132 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


season, wages, subsistence, fuel, oil, insurance, motive power, and repairs, with 
5 per cent interest on investment and for depreciation. 

Even with antique 240-ton wooden canal boat making but seven trips a 
season, Maj. Symonds presents detailed data showing cost of hauling wheat 
from Buffalo to New York over Erie route 1.75 mills per ton-mile. 

Applying same method to “ Seymour ” canal improvement plan allowing use 
of 320-ton boat, Maj. Symonds reduces ton-mile cost to 1.16 mills. 

“ Seymour-Adams plan,” allowing use of 400-ton boat reduced cost, according 
to Maj. Symonds, to 1 mill per ton-mile; and “ committee plan ” providing for 
use of 450-ton boats made still further cut to 0.88 of 1 mill. 

( g ) Report of United States Engineers Potter, Shunk, and Peek (May 14, 
1913) finds that Lake Superior-Mississippi River project will accommodate use 
of 550-ton barges. These have double capacity of old Erie barges, are up-to- 
date and best modern type, and make far better speed and several times as 
many trips in a season. Therefore, they should average a lower rate, and 
should do materially better than 2 mills per ton-mile, or 50 cents per ton for 
250-mile haul. In section 99 of the report, the local board of engineers estimate 
that the canal fleet, consisting of tow vessel and four 550-ton barges, requires 
nine days for the round trip from Duluth to Minneapolis and return, or “ 25 
round trips in a season.” On the old Erie Canal, according to Maj. Symonds. 
the tow vessel handles four 240-ton barges at the rate of only seven round trips 
per season, and still does the work at 1.75 mills per ton-mile, including all 
operating and fixed charges. It appears that the situation on the Lake Su¬ 
perior-Mississippi River project, therefore, is more nearly analagous to the 
plans submitted by Maj. Symonds and the New York Canal Commission provid* 
ing for the use of 400-ton and 450-ton barges at a cost of 1 mill per ton-mile. 

COST OF TRAN SPORT ATION ON MONONGAHELA RIVER. 

25. The Monongahela River, which joins the Allegheny at Pittsburgh to form 
the Ohio, offers the example of a waterway that has escaped control of hostile 
influence and is maintained by the Government in a condition for successful 
operation as a commercial waterway, just as the Erie during the past 20 years 
is a warning example of how a once successful waterway may be suffered 
through hostile influence to fall into a condition of neglect. 

The Monongahela, year after year for years, has furnished Pittsburgh a 
large portion of its coal supply. It seldom handles less than 10,000,000 tons a 
year and from that up to 12,000,000. Monongahela barges deliver this coal at 
Pittsburgh at a transportation rate so low that railroad competition, so far as 
the rate is concerned, is out of question. At the same time, the Monongahela as 
a whole is a 6-foot project—6 of its 15 locks through the central section of its 
131 miles from Fairmont to the mouth having only 5 to 6 feet depth on the 
lower sills—and the bulk of its freight is carried in boats, barges, and flats of 
300 to 500 tons cargo capacity, such as readily would find ample navigable 
depth on the proposed Lake Superior-Mississippi River route. 

( a ) Chief of Engineers, United States Army (report of 1912, pt. 1, p. 894), 
says of effect of Monongahela on freight rates: 

“The effect on freight rates of the slack-water system of the Monongahela 
is great. This is particularly true for coal, which is the principal article of 
commerce, and is well shown by a comparison of the railroad rates for carload 
lots along this river and those along the unimproved Allegheny. There are 
many mines along the Monongahela River that can ship by rail or by water, 
and within a distance of 45 miles from Pittsburgh, which practically covers the 
industrial district on that river, there is a rate of 10 cents a ton on hauls not 
exceeding 7 miles. For corresponding distances on the Allegheny the rates 
average about 35 cents a ton. One large consumer transports coal by river a 
distance of about 50 miles at a total cost of less than 10 cents a ton, including 
all charges, while the corresponding railroad freight rate is 45 cents a ton.” * 

One the basis of the above official statement of the Chief of Engineers* the 
saving in cost of transportation 6y water, including all charges, is 35 cents a 
ton on a 50-mile haul. 

(fr) United States Inland Waterways Commission (p. 113 of 1908 report) 
states that the Jones & Laughlin Steel Co., through its coal and river naviga¬ 
tion subsidiary, the Yesta Coal Co., enjoys on the Monongahela “the cheapest 
transportation service in the world, carrying coal between the mines and the 
mills, a distance of 48 miles, at the low cost of 3£ cents to 5 cents per ton.” 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 133 


On page 108 of the same report the commission gives the coal fleet of this 
company as 160 barges of 300 tons net cargo tonnage each and 31 barges of 
500 tons each. Thus the record for low cost of transportation is made in river 
barges of the cargo capacity adapted to the proposed waterway project under 
discussion. 

Excepting the three lower locks on the Monongahela in the Pittsburgh dis¬ 
trict, deptli on the lower sill of Monongahela locks is similar to that on pro¬ 
posed Lake Superior-Mississippi project and on the upper Mississippi project. 
Twelve of the fifteen Monongahela locks (see Exhibit II hereto attached) have 
5 to 7 feet depth on lower sills. Locks Nos. 4 to 9, inclusive, which are located 
in the middle section of the waterway, 40 miles to 100 miles above the Monon¬ 
gahela mouth, have depths ranging from 5.2 to 6 feet. During the dry season 
this section, as shown by reports of United States engineers, frequently has 
only 5 feet of navigable depth. Tow vessels and barges used on the Monon¬ 
gahela have average draft of 4 to 5 feet. 

(c) Proceedings of Engineers Society of Western Pennsylvania (p. 270. 
June, 1908, session) contain the statement in regard to cost of coal transporta¬ 
tion on Monongahela: 

“A local interest tows its coal from pool No. 4 (located 41 to 58 miles above 
Pittsburgh) to Pittsburgh at cost of about 4 cents per ton by river—and that 
too on a stream where the lockages are limited to a certain extent—whereas 
the coal tariff rate by rail for the same distance is 33 cents per ton.” 

(d) In the same proceedings United States Engineer Thomas P. Roberts (United 
States engineer office, Pittsburgh) in a paper (p. 204) discussing Ohio and 
Monongahela transportation, including types, costs, and methods of handling 
river boats and fleets, predicts smaller but more numerous fleets at less capital 
investment and cost of transportation and concludes: 

“ We may expect, therefore, a lowering of freight rates on a river where the 
cost of transporting cargoes in fleets of barges is already lower than it now is 
with single 12,000-ton steamers on the Great Lakes.” 

( e ) United States engineer office, Pittsburgh, by direction and in the absence 
of Lieut. Col. Francis R. Shunk, Corps of Engineers, transmitted to the com¬ 
mission on November 7, 1913, in answer to questions submitted in writing, the 
following detailed data of cost of transportation on Monongahela, prepared by 
Asst. Engineer Thomas P. Roberts (see Exhibit 3 attached) : 

“ Several years ago the Jones & Laughlin Steel Co. reported officially that the 
actual cost to them of moving coal from their mines to their mills and coke 
ovens in Pittsburgh, then doing a business of 2,000,000 tons per annum, was 
4.2 cents per ton. The round trip distance was 104 miles, including the passage 
of three locks in each direction. The estimate included the return of the empty 
boats to the mines. The final result was a ton-mile rate of 0.08 cent. To this 
was added by this office interest account on capital invested at 5 per cent and 
15 per cent for depreciation of floating plant, which brought the ton-mile rate 
up to 0.18 cent, or 1.8 mills.” 

On this computation the cost of operation was eight-tenths of 1 mill per 
ton-mile, while 20 per cent to cover interest and depreciation added 1 mill more. 
This estimate of 20 per cent for fixed charges would pay for first cost of fleet 
in five years, and would appear unnecessarily high. If the more common esti¬ 
mate of 10 per cent for interest and depreciation were used, the total cost of 
transportation would be 1.3 mills per ton-mile. 

The same inclosure (Exhibit 3) gives average capacity of Monongahela boats, 
barges, and flats at 200 to 500 tons; and that the Pittsburgh district (for 
several years past) receives about 12,000,000 tons of cargo coal per annum. 

(/) The Chief of Engineers, United States Army, in his report for 1912 (p. 
905, pt. 1) suras up the case thus: 

“A comparison of the cost of delivery of Monongahela River coal by rail and 
by river to points in the pools above Dam 6 shows a saving of from 30 to 50 
cents a ton in favor of water transportation.” 

( g ) in answer to the inquiry of the Minnesota commission for detail on 
which the above estimate was based, United States engineer office, Pittsburgh, 
by Chief Clerk A. J. Rossiter, for and in the absence of Lieut. Col. Francis R. 
Shunk, Corps of Engineers, forwarded November 14, 1913, the following infor¬ 
mation (see Exhibit 4) prepared by Thomas P. Roberts, assistant engineer: 

« Reference is to Dam 6 on the Ohio, about 29 miles below Pittsburgh. The 
center of the active river mining district on the Monongahela is about 50 miles 
above the city. The 50-cent saving is therefore for the 29 plus 50, or 79-mile 
distance, and the 30 cents for the 50-mile distance to Pittsburgh.” 


134 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


APPLICATION OF MONONGAHELA RIVER AND ERIE CANAL RATES TO PROJECT. 

26. Following are some of the features which make water transportation on 
the Monongahela and Erie similar to that on Lake Superior-Mississippi Canal 
and upper Mississippi: 

(a) Depth of navigable channel. —Coal originating on pool No. 4 on Monon¬ 
gahela, 50 miles above Pittsburgh, passes Lock No. 4 (Exhibit 2) which has 
5.87 feet depth on lower sill and at time above detailed statistics were furnished 
had dimensions of 158 by 50 feet. Locks on Lake Superior project as proposed by 
engineers have 6 feet minimum depth and are 175 by 35 feet. Although former 
depth of Erie was nominally 7 feet, actual navigable depth was allowed by 
neglect to fall to about 5 feet and permitted boats of only 4 to 4* feet draft and 
240 tons of cargo. 

(b) Cargo capacity of boats and barges. —United States Engineers report 
550-ton barges adapted to Lake Superior-Mississippi projects. Vesta Coal Co. 
which makes record of 4 to 5 cents per ton on coal for 50-mile haul and return 
trip on empties—or less than 10 cents, including all charges as reported by the 
Chief of Engineers—uses 160 boats of 300 tons cargo capacity and 30 barges 
of 500 tons. One of its principal model towing vessels, the Vesta, which tows 
five to seven 500-ton barges, and has speed of 10 to 12 miles an hour, has 
draft of 4.1 feet. On Erie Canal only 240-ton boats were used. On Champlain 
Canal, during season of 1913, canal boats carrying coal from New York Harbor 
to Montreal and Quebec were allowed to load only 160 tons, and tow vessels 
with capacity of 13 boats were allowed to haul only five because of condition 
of canal, and yet the canal-and-river route of 320 miles from Perth Amboy to 
Quebec took the coal business away from both the railways and ocean vessels. 

(c) Return cargoes for canal and river. —Monongahela coal barges which 
haul 10,000,000 tons of coal to Pittsburgh have no return cargoes, and the low 
rate made covered cost of return trip of empties. Wheat boats which carried 
the heavy grain tonnage on the Erie from Buffalo to New York made the 
return trip with only one-third cargoes, because merchandise on the average 
makes light tonnage. The Lake Superior-Mississippi project, on the other hand, 
has cargoes both ways. Coal, iron, steel, cement, and merchandise comprise 
the down tonnage from the Lakes. Wheat and coarse grain from one of the 
leading grain districts of the world, flour from the greatest flour-milling center 
on the globe, linseed oil and cake from the chief linseed manufacturing center, 
limestone from the St. Croix and upper Mississippi ledges for Duluth-Superior- 
furnaces and cement works, potatoes and general farm produce for the mine, 
mill, and dock population on the Lakes and for eastern shipment, brick and 
various building materials for lake and eastern construction enterprises—con¬ 
stitute a return tonnage which does not exist on either Monongahela or Erie. 
Then there is the through tonnage from the Mississippi Valley and Gulf, and 
varied local tonnage arising in canal zone. 

(d) Rates which such conditions afford. —Under parallel conditions, or in 
several respects less favorable conditions, on the Monongahela River and Erie 
Canal, barge and boat equipment of capacity similar to that recommended by 
engineers for Lake Superior-Mississippi project shows transportation cost of 
1 to 2 mills per ton-mile. This would be 25 to 50 cents per ton for the Dulutli- 
Minneapolis haul, as compared with $1.02, which engineers estimate as average 
rail charge. Under such conditions the project should have no difficulty in 
securing and holding its due share of the large tonnage which will tax rail, 
canal, and river by the time the canal link can be completed and put in opera¬ 
tion ; and thus insure the commercial feasibility of the barge route, in competi¬ 
tion with, or in cooperation with, the box car. 

(e) Advantages of new and up-to-date equipment, methods of handling, and 
mode of administration, and of new and rapidly growing territory and re¬ 
sources. —The new enterprise, moreover, will be launched under new and 
hopeful auspices, free from hostile influences or control, when the country is 
turning to waterways as a necessary aid to railways, and will have new and 
up-to-date equipment and administration in a section of tremendous resources 
and yearly development. 

WATERWAY FROM ALABAMA COAL FIELDS TO MOBILE. 

27. The Government is now entering upon the completion of the 6-foot navi¬ 
gation project of canalizing the Mobile, Tombigbee, Warrior, and Black Warrior 
Rivers for a distance of 443 miles from Mobile Bay to the northern Alabama 
coal fields. Estimated cost is $8,675,000, and about 20 locks and dams are 


WATERWAY PROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 135 


required. The Alabama and New Orleans Transportation Co. is having 15 
steel self-propelling producer-gas barges built by the Great Lakes Engineering 
Works, of Detroit, for the development of the coal fields and the transportation 
of the product to Mobile, New Orleans, and Pensacola. The first barges have 
started upon their work. 

In an article in the Engineering News of December 4, 1913, the barges used 
by the above company are fully described as well as the canal and waterway 
upon which the fleet of barges operate. Mr. John H. Bernhard, the designer 
and builder of the barges used by the above company, in a letter to the counsel 
for the Minnesota commission, dated April 9, 1914, says: 

“At present the Alabama & New Orleans Transportation Co. has seven 
finished barges of the type described in said article; said barges have been 
running for several months, the first one being in operation since July of last 
year and beyond the troubles resulting from inexperienced crews have given 
perfect satisfaction, moving their freight (in this instance coal) at less than 
two-fifths mill per ton-mile. 

“ The barges are designed for 6-foot navigation and indeed have to meet a 
great variation of conditions in the water route as to depth, width, and swift¬ 
ness of current. The river runs through the coal fields and the coal is dumped 
from the mine cars into the loading station from which the 1,000-ton barges 
are loaded with their cargo at the rate of 500 tons per hour. It costs approxi¬ 
mately 2£ cents per ton to load and 3 cents per ton to unload. 

“ I believe the barges would be especially adapted for use from Lake Superior 
through the St. Croix River to the Mississippi River and thence down said 
stream. 

“ I am positively sure of the above cost of loading and unloading which is a 
matter of record in our office and will be able to prove to any one at any time 
the correctness of said figures. 

“ I note the local engineers charge the canal 25 cents to load and 25 cents 
to unload, and beg to state that they are making a serious blunder. In Nor¬ 
folk, coal is loaded into the bunkers of seagoing vessels for a total cost, in¬ 
cluding trimming, of 7 cents per ton, but, where the vessel is a self-trimmer, as 
these barges are, only 4$ cents per ton is charged. 

“ I note further that the local board of engineers have charged that the coal 
is deteriorating 25 cents per ton on acount of handling with the clam shell. 
To be short in my reply to this, I would like them to quote me one instance 
where this has cost such an amount of money. I can cite instance after 
instance where coal has been handled by clamshells and deterioration is not 
sufficient to take account of in figures. 

“ It will be possible to build self-propelled barges that would operate economi¬ 
cally on the canal under discussion with a carrying capacity of 500 tons, and I 
would undertake to state that you should be able to handle coal from Lake 

Superior to the Mississippi River, including cost of loading and unloading, 

for less than 25 cents per ton. 

“ John H. Bernhard.” 

The Lake Superior-Mississippi River project, like the Alabama project, will 
find coal its chief commodity. The rate of 30 cents per ton on coal from Lake 

Erie to Duluth-Superior equals in cost a haul of 50 miles by rail. This is 

equivalent to the location of the lake terminus of the Lake Superior-Mississippi 
Canal within 50 miles by rail of the Lake Erie ports which handle 24,000,000 
tons of Pennsylvania, Ohio, and West Virginia coal. The Alabama project has 
a haul of 443 miles from the northern coal fields; while the Lake Superior- 
Mississippi project has a haul of 210 miles from the lake supply to the Missis¬ 
sippi River, and a large group of upper Mississippi distributing centers and 
river terminals for the consumption and distribution of its coal cargoes; 237 
miles to St. Paul and 250 miles to Minneapolis. The logic which justifies the 
Alabama project, therefore, applies with force to the Lake Superior-Mississippi 
project; for Minnesota and Wisconsin produce no coal, and the source of the 
best and cheapest coal for about 2,000,000 population in the cities and counties 
of the canal zone and tributary to the Mississippi in those States, is the Great 
Lakes supply which has the 30-cent rate from Lake Erie. 

KANSAS CITY RIVER TRANSPORTATION PROJECT. 

28. Another navigation project authorized by the Government is $20,000,000 
to provide a 6-foot channel for the 408 miles from Kansas City to the mouth 
of the Missouri River. Kansas City merchants and manufacturers have 


136 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER 


organized the Kansas City Missouri River Navigation Co., a million dollar boat 
line, and opened river service from Kansas City to St. Louis on present 4^-foot 
depth. Three modern steel tow vessels of the tunnel-screw type and seven 
barges have been installed in freight service; and the city is providing proper 
public docks and freight terminals. 

The above company commenced operations last season on the unimproved 
river, handling a comparatively small tonnage on account of the unusually low 
water occasioned by very severe drought in the district. The fleet handled 
very little bulk freight, most of the tonnage being package freight and a great 
deal of it high class. We quote from a letter from the secretary of the Kansas 
City Missouri River Navigation Co.: 

“ Our rates are uniformly 20 per cent lower than the rail rates between the 
points we reach, and we absorb the switching charges on carloads, so as to give 
the shipper a net saving of 20 per cent as compared to rail rates.” 

Thus Alabama, Missouri, and Monongahela projects are all 6-foot channel 
projects, and will float the same capacity of river barges as the upper Missis¬ 
sippi 6-foot project and the proposed Lake Superior-Mississippi 6-foot project; 
and the commercial feasibility of these 6-foot projects successfully competing 
with the railroad is sustained by the action of the Government. If it is com¬ 
mercially feasible to expend $20,000,000 to give Kansas City and the valley of 
the lower Missouri transportation access by water with the Mississippi, similar 
logic would find it commercially feasible to expend $7,815,000 to give the Missis¬ 
sippi Valley a through channel into Lake Superior, the commerce of which, as 
measured by the Soo Canal, includes 75,000,000 tons of freight valued at 
$800,000,000. 


TBAFFIC EXTENSION ON ALLEGHENY AND MONONGAHELA. 

30. The Chief of Engineers, United States Army (1912 report, 897-899), dis¬ 
cusses project adopted by Congress for construction of five additional locks and 
dams on the Allegheny to extend slack-water navigation to a point 61 miles 
above its confluence with the Monongahela, at cost of $2,788,000. On that part 
of project already completed, 1,374,626 tons of coal were moved in 1911. The 
purpose, as defined by the Chief of Engineers, is “ to give manufacturing plants 
in this section the benefit of the cheap river rates on coal and other sup¬ 
plies. * * * Even under existing conditions one large consumer of coal 

reports a saving of 25 cents per ton on Monongahela River coal delivered by 
water, compared with delivery by rail.” 

Similar benefits of cheap water rates would accrue to the Northwest on coal, 
iron, and steel from Duluth-Superior Harbor to manufacturing plants at Still¬ 
water, Hastings, St. Paul, Minneapolis, South St. Paul, Red Wing, Lake City, 
Wabasha, Winona, La Crosse, and Eau Claire, and other tributary river manu¬ 
facturing centers, which have an aggregate city population of 750,000, with an 
assessed taxable valuation of $400,000,000, and whose 2,100 manufacturing 
plants, according to the United States industrial census of 1909, employed 
$185,000,000 of capital and turned out a product valued at $260,000,000. 

Expansion of river coal and steel traffic up the Monongahela River and on 
the upper Ohio is described on page 9 of the final report of the National Water¬ 
ways Commission (1912). Reference is made to the new works of the American 
Bridge Co., at Ambridge, 15 miles below Pittsburgh, for the manufacture of 
steel barges, scows, and other steel water craft, and also to the water navigation 
plans of the Crucible Steel Co. of America, which “ is practically ready to 
commence transporting its coal by water from the sixth pool in the Monongahela 
River to its mills and factories at Pittsburgh and at Midland, 36 miles below. 
This coal was formerly obtained entirely by rail. This company expects to 
transport by river about 1,000,000 tons of coal annually, and also to transport 
its pig iron and steel products by water to lower river ports.” 

The sixth pool on the Monongahela, where this company gets its coal, is 
located 7 miles above Pittsburgh, and the depth on the lower sills of (see Ex¬ 
hibit 2) Locks 4, 5, and 6, which the coal barges pass, is only 5.2 to 5.8 feet. 
Moreover, the river bank for this haul is thickly paralleled with competing 
coal railroads, which makes a convincing practical argument for the superior 
commercial feasibility of the waterway, as compared with railway, in coal 
transportation. 

If further demonstration were required of the superiority of water trans¬ 
portation in coal handling, it is furnished in the fact that the Pittsburgh Coal 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 137 


Co., which is the leading coal company for the supply of Duluth-Superior and 
the proposed canal zone, including the Twin Cities, has acquired possession of 
the largest bulk coal carrier on the Ohio, Mississippi, and tributaries, namely, 
the Monongahela River Consolidated Coal & Coke Co., which operates 80 tow¬ 
boats and steamers and 4,000 coal boats, flats, and barges, with cargo capacity 
of over 2,500,000 tons, and handles by river 4,500,000 tons of coal per annum. 

As showing what the leading steel corporation in the world thinks of the 
commercial feasibility of river transportation of coal—although this corporation 
itself owns and operates railroads—the contract made by the United States 
Steel Corporation with the Pittsburgh Coal Co., as shown by Government testi¬ 
mony, by which the coal company for a period of 25 years is to provide the steel 
company with coal for its use, through the Monongahela River Consolidated 
Coal A Coke Co., requires delivery by water whenever possible because cheaper. 

The steel company’s further recognition of the superior commercial feasibility 
of river over rail in coal transportation is shown by the enterprises and opera¬ 
tions of two of its distinguished subsidiary companies, namely, American Steel 
& Wire has installed a fleet of 100 barges and towboats for moving its coal on 
the third and sixth pools in the Monongahela River to its mills at Donora, 
Rankin, and Rraddoek, and to its Schoenberger mill on the Allegheny; while the 
American Bridge Co. is building for various United States Steel plants located 
on rivers and canals the necessary barges, towboats, and other steel watercraft. 

CAUSES OF DECLINE OF RIVER COAL AT CINCINNATI. 

31. Col. Potter and associate engineers express apprehension of the ability of 
the Lake Superior-Mississippi canal and river route to secure and hold the canal 
tonnage because of certain experience of Cincinnati in regard to the Ohio River 
coal business. Quoting a letter from the Cincinnati Chamber of Commerce, in 
which the railroads are cited as cutting into the river traffic, Col. Potter says 
that this “ indicates that the railroads are running the Ohio River, the greatest 
coal river in the world, out of the coal business, on a haul of 200 or 300 miles, 
although the actual difference in freight rate in favor of the water haul is 374 
to 50 cents.” 

The apprehension thus expressed is not borne out by recent traffic data. At 
the same time it is plain that certain coal-carrying railroad companies did make 
a well-concerted effort to throttle the Cincinnati river coal business. As brought 
out by Government investigation by Congress and the Bureau of Corporations, 
the coal roads brought the following methods to bear in depriving the river 
lines of coal traffic: (1) Purchase of competing lines which handle river coal, 
(2) control of terminals and terminal charges, (3) discriminating joint rates 
and prorating against river carriers, (4) secret rates, (5) discriminating switch¬ 
ing charges, (0) purchase of controlling interest in coal lands and mines. 

Remedy for such practices, however, lies in Government prosecution and con¬ 
trol of traffic and not in defeating the opening of additional waterways. That 
the conditions at Cincinnati have already been materially righted is shown by 
the statistics by The Coal Trade (1913), Frederick E. Saward, editor: Cincin¬ 
nati coal receipts from the Kanawha River increasing from 807,560 tons in 190S 
to 1,531,572 in 1911, and the river receipts from the Pittsburgh district increas¬ 
ing from 535,880 tons in 1908 to 1,313,981 in 1912. Thus the causes of apprehen¬ 
sion at this point are already removed. 

Indeed, the 1912 report of the .Chief of Engineers, United States Army (p. 
2366), indicates that river coal traffic on the Kanawha River canalized project 
has been highly feasible from a commercial standpoint. In 1911 the 55-raile 
haul through the Kanawha locks bore a coal cargo of 1,346,140 tons at the rate 
of 0.97 of 1 mill per ton-mile. The report also shows that between Charleston 
and Montgomery, W. Va., the rail charge of 50 cents per ton has been reduced 
by the canalized river to 5 cents per ton, an achievement stamped with a high 
order of commercial feasibility. 

THE CHIEF OF ENGINEERS ON UPPER OHIO RIVER TONNAGE. 

32. By way of further relieving the apprehensions of the local board of en¬ 
gineers with reference to defeat of inland waterway transportation of freight, 
the Ohio River system in particular, through action of the cause specified, to wit, 
“ the railways are running the Ohio River, the greatest coal river in the world, 
out of the coal business,” we herewith summarize the freight tonnage, of which 


138 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


coal is the leading commodity, of the Ohio and principal tributaries for the year 
1911, as reported by the Chief of Engineers, United States Army, to the Secre¬ 
tary of War, Washington, D. C., October 8, 1912, as follows: 


River. 

Page of 
report. 

River ton¬ 
nage, 1911. 

River. 

Page of 
report. 

River ton¬ 
nage, 1911. 

Mononpn.hela 

2308 

1 10,747,041 

2 1,720,742 

Muskingum. 

2370 

72,145 

Allegheny . 

2311 

Big Sandy. 

2390 

181,770 

Pittsburgh Harbor. 

Locks 1 to 6, Ohio. 

2341 

2337 

* 12; 519,776 
4,105,649 

Kentucky. 

Louisville & Portland 

2406 

209,249 

Kanawha. 

2366 

1,392,788 
120,244 

Canal. 

2426 

944,656 

Little Kanawha. 

2360 

Green River, Lock 1. 

Ohio River commerce.... 

• 2444 
2287 

329,032 

4 11,771,892 


1 Estimate of which report says: “Which amount is manifestly less than the actual movement of com¬ 
merce.” The 15 Monongahela locks show a total of 28,442,579 tons of down-river tonnage and 2,786,396 
of up-river tonnage. To eliminate duplications, United States engineers took downstream tonnage at 
Lock 3, plus upstream tonnage at Lock 1, plus coal mined in pools 1 and 2, as a basis for estimate. This, 
of course, covers business in and out of Pittsburgh Harbor, but omits commerce which begins and ends 
between mines and mills and towns located between Locks 3 to 15, inclusive, covering 90 miles of the total 
131 miles of the canalized river between Pittsburgh and head ofslackwater, 4 miles above Fairmont,W. Va., 
which doubtless would extend the Monongahela River total to 12,000,000 tons. 

2 This is simply the tonnage reported by leading shippers, and would exclude a large number of small or 
intermittent shippers and others not filing regular reports. 

3 Largely local business of mines and mills, coke ovens and furnaces in Pittsburgh district, including 
some through tonnage from Monongahela mines to Ohio and Mississippi points. 

4 Reported by Col. Jervey in chapter on first Cincinnati district of the Ohio River, and doubtless covers 
tonnage passing through that district. 

SUMMARY OF UPPER OHIO AND TRIBUTARY RIVER TRAFFIC. 

33. It is difficult to estimate how much of the total 44,000,000 tons of freight 
handled by river boats and barges on the Ohio and upper tributaries is net 
tonnage and how much should be eliminated as duplication. Omitting the 
12,500,000 of Pittsburgh Harbor and 11,700,000 of Ohio River proper, we have 
20,000,000 tons on the tributaries. To this should be added that which origi¬ 
nates for Ohio and Mississippi commerce in the upper Ohio ports exclusive of 
the tributaries. This would doubtless make a total net tonnage of somewhere 
between 25,000,000 and 30,000,000 tons. It would therefore appear that, in spite 
of all natural and likewise all abnormal and preventable obstacles which have 
hampered river commerce on the Ohio and upper tributaries, traffic has 
demonstrated the commercial feasibility of inland waterways in the United 
States and justified the faith of the Government and the loyal efforts of the 
engineers in charge. 

Summarizing these results with reference to features applicable to pro¬ 
posed Lake Superior-Mississippi river-and-canal route we find: 

(a) That 20,000,000 tons of freight are carried on canalized tributaries of 
tlie Ohio River at rates so far below rail rates that industrial interests affil¬ 
iated with railways are compelled to use the slack-water barge fleet in prefer¬ 
ence to the roads paralleling the streams. 

(&) That these canalized tributaries are Government 6-foot depth of channel 
projects financed and operated by the General Government. 

(c) That the boats, barges, and tow vessels used are of the draft and cargo 
capacity recommended by the engineers for the Lake Superior-Mississippi 6-foot 
project. 

( d ) That, on the authority of the engineer in charge on the Monongahela, the 
500-ton barges delivering coal in that district have reduced cost of transporta¬ 
tion to the basis of the 12,000-ton barges on the Great Lakes—the lowest trans¬ 
portation cost known. 

(e) That, on the authority of the Chief of Engineers, United States Army, 
the saving is as much as 30 cents per ton on a 50-mile haul and 50 cents on a 
79-mile haul which applied to the Lake Superior-Mississippi coal haul would 
commercially justify the project. 

(/) That the practical experience and close engineering estimates of the 
leading coal, iron, and steel interests of the greatest coal, iron, and steel district 
in the world compel them to substitute the 500-ton barge for the box car in 
handling their products, notwithstanding their own railway affiliation and even 
ownership and operation of coal roads. 
























WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 139 


Finally, we find that these same industrial interests of the Pittsburgh coal, 
iron, and steel district now propose to finance the construction of a $60,000,000 
canal from Pittsburgh to Lake Erie, so as to secure the commercial benefits of 
low canal cost of transportation to the Great Lakes—even though the actual 
cost of rail transportation over roads owned and operated by them over that 
route is reported as low as 3 mills per ton-mile. 

PAST OBSTACLES NOT NECESSARILY APPLICABLE TO FUTURE PROJECTS. 

34. Among the preventable obstacles over which this successful river com¬ 
merce has triumphed—obstacles which under the present temper and probable 
future policy of the Government and of the public in this country will find little 
toleration and excuse for existence—may be briefly enumerated the following, 
the abatement or amelioration of which is a material factor favorable to the 
pending project: 

(а) Lack of a defined national waterway policy with necessary executive 
powers and funds to make such policy effective. 

(б) Lack of standardization in depth of channel and type of equipment so 
as to create channels of commerce. 

.(c) Lack of coordination in projects undertaken so as to create an inter¬ 
locking system of waterways necessary to the existence of channels of water¬ 
way commerce. 

( d ) Failure of past Congresses to provide Government engineers with means 
to put into successful operation projects undertaken. 

(e) Failure to give the Interstate Commerce Commission sufficient jurisdic¬ 
tion over waterway and joint water-aml-rail transportation to prevent destruc¬ 
tion of river-and-canal traffic by discriminating railway rates and prohibitive 
terminal and switching charges, by refusal to provide connecting railway service 
with joint through rates for water lines and carriers, and rebates, secret rates, 
and intimidation of shippers. 

(/) Failure of the Government to prevent railway control of canals, termi¬ 
nals, waterway equipment, and water transportation agencies and traffic. 

(g) Consequent railway control of waterway channels, terminals, frontage, 
and boat lines; paralleling of rivers and canals with tracks preventing water¬ 
way locations for mercantile and manufacturing plants and sites necessary for 
handling water-borne freight; erection of low bridges prohibiting use of large- 
type boats; diversion of traffic so as to substitute a profitable rail haul for low- 
cost water service; arbitrary terminal charges killing river commerce; and gen¬ 
eral neglect of waterway and bankruptcy of boat-line owners. 

Detailed data and citations on this phase of the subject, in addition to those 
herein quoted, may be had by consulting reports of the Chief of Engineers, 
United States Army; reports of Bureau of Corporations of the Department of 
Commerce, of House Committee on the Merchant Marine and Inland Water¬ 
ways, of the National Waterways Commission, of the Interstate Commerce 
Commission, and of testimony of business men and naval and marine engineers, 
experts, shippers, boat owners, and operators before various Government au¬ 
thorities. 

Consideration of the above conditions in connection with proposed report 
is made necessary and germane to the question of commercial feasibility by 
reason of the position taken by the local board of engineers, in the report of 
May 14, 1913, in assuming as fundamental to the operation of the canal and the 
receipt, distribution, and terminal handling of traffic such arbitrary conditions 
as the following: (1) A terminal charge of 25 cents per ton at each end of 
the barge route, which at the outset would perhaps kill any inland waterway 
project; (2) dependence upon arbitrary will of competing roads for any traffic 
whatever; (3) control of terminals, terminal freight handling, and terminal 
charges by railroads; (4) railroad-owned boat lines on the Great Lakes at 
harbor connection with canal; (5) “railroad-controlled” elevators assessing 
all river-and-canal grain shipments with charges of 18 cents to 44 cents per 
ton at all loading, unloading, and transfer points; (G) railway charges of 35 
cents per ton on flour, even to get flour from the mill on the river bank to the 
barge close at hand; (.7) arbitrary influence of railway companies in diverting 
traffic, refusing cooperative connecting service, and by arbitrary prorates, joint 
rates, switching and terminal charges taxing water traffic out of existence. 

In regard to all of which it is sufficient to state, that railway companies 
have no lawful power at this time to impose such hostile conditions, and that 


140 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER 


the attempt at such exactions would render them liable to Government and 
State prosecution. 

GOVERNMENT ADMINISTRATION OF WATERWAY AND CONNECTING RAILWAY. 

35. Commercial success of the waterway in handling the inland traffic of 
Germany, Belgium, Holland, France, and other European countries is due in 
large measure to an efficient and commercially scientific system of govern¬ 
mental administration. There the Government which owns the waterway 
attends to its executive administration as a public business enterprise, just 
as our Government does with its post offices and is preparing to do with the 
Panama Canal. The result is that the canals and canalized rivers of these 
countries are kept in efficient condition for commerce; the relations between 
waterway and railway are placed on a cooperative basis with mutual and 
reciprocal benefit to each; the industries of the country are developed and 
given cheap and efficient access to the seaboard; while the commerce of the 
inland waterways has grown at a rate exceeding the rate of population growth, 
and even slightly in excess of the growth of tonnage handled by rail. Grain is 
to-day hauled a distance of 300 miles on the Rhine at one-fourth of the Iowa 
distance tariff rate by rail, and coal is hauled 200 miles at 48 per cent of the 
Hocking coal district rate to the lake. (See 1912 report of National Water¬ 
ways Commission, pp. 568-569.) The 100,000,000 tons of inland commerce 
hauled by the canals and canalized rivers of Germany demonstrate the value 
of effective administration by government, as well as the commercial potency 
of the inland waterway in developing the now greatest industrial power in 
Europe. 

Among the features of such effective administration are: 

(a) Grant of sufficient powers by Congress to an executive department to 
organize and administer the inland waterways of the United States as mod¬ 
ern business enterprises in America, and as waterways are successfully admin¬ 
istered in the most successful foreign countries. 

(b) Extend the powers of the Interstate Commerce Commission to cover, 
waterways and joint river-and-water transportation, with complete control 
over interstate rates, prorates, joint rates, and terminal charges. 

Measures looking to these ends are now before Congress, and doubtless 
will be in effect by the time the proposed project can be completed and placed 
in operation. This removes from necessity of present calculation the source 
of the chief obstacle to commercial feasibility, as advanced by the local board 
of engineers with reference to the Lake Superior-Mississippi waterway project. 
Efficient governmental administration and governmental regulation of rates 
and terminal charges will eliminate the arbitrary and unreasonable terminal 
exactions by connecting railroads, which is the basis of the high cost of canal- 
and-river transportation as estimated in the board’s schedules, and will also 
provide for a system of cooperative effort between railway and waterway 
which will develop the profitable commerce of both, together with the indus¬ 
tries of the canal zone in the Lake Superior and Mississippi industrial re¬ 
gion, as in Germany, Holland, Belgium, France, and Austria-Hungary. 

PUBLIC OWNERSHIP AND CONTROL OF TERMINALS. 

36. Terminals largely control receipt and distribution of tonnage. The water¬ 
way being public property under public administration, it is essential to the 
commercial success of the enterprise that the terminals likewise shall be pub¬ 
licly owned and controlled. Failure in this respect is admittedly the principal 
cause of the failure of many of the canals and Government waterway projects 
of this country in the past to secure and hold business. It is elemental that the 
success of any enterprise rests, primarily, upon the effective grant to the 
management of ample power to administer the controlling factors essential to 
the legitimate success of the enterprise. Certainly success is not possible 
when the controlling factors are in the hands of a competitor who is unfriendly 
to the success of the enterprise in question, as is the case when the docks, 
water frontage, and terminal facilities upon which the waterway depends for 
traffic are in possession and control of a competing railway. 

Public ownership and control of docks and other terminal waterway facilities 
is common in the countries of Europe except Great Britain, where waterways, 
as a consequence, have not met with complete success. Until recently only the 
States of California and Louisiana in this country protected the rights of water 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 141 

carriers by public administration of waterway terminals. The past two years, 
however*, have inaugurated a widespread movement for public ownership and 
control of docks, water frontage, and terminal handling facilities at the princi¬ 
pal harbors along our coasts, and the movement has begun at interior ports. 
Among such harbor and inland port cities now building State and municipal 
docks and terminals for water-borne freight may be mentioned New York, 
Boston, Philadelphia, Jacksonville, Pensacola, Mobile, New Orleans, Galveston, 
Houston, Los Angeles, San Diego, San Francisco, Oakland, Portland, Seattle, 
Chicago, St. Louis, Kansas City, Davenport, and Minneapolis. Total bonds 
authorized for issue by States and municipalities for such public terminals 
approximate $200,000,000. Leading Canadian harbor cities are equally public 
spirited and enterprising in the cause of the development of their public 
water terminals and commerce. 

The feature of this movement specifically germane to the project at hand 
is this: That such public terminals furnish the waterway with terminal 
facilities at cost, as a substitute for present arbitrary terminal exactions levied 
by competing private carriers, to wit, in place of the 25-cent and 35-eent 
terminal charge estimated by the local board of engineers for transfer from 
lake barge to canal barge at Duluth-Superior and again for transfer at the 
St. Paul or Minneapolis terminal, such charge will be reduced by the public 
terminal to actual cost of handling, which is on the average 2 to 5 cents per 
ton. 

' COST OF HANDLING COAL. 

The principal difficulty of the local board of engineers with reference to 
calculating the commercial feasibility of the Lake Superior and Mississippi 
River Canal project appears to have arisen in accepting the statements of 
those opposed to the project that the railroad terminal arbitrary charge of 
25 cents per ton as the actual cost of handling the coal at the river terminal 
in the Twin Cities is 25 cents per ton, the cost of deterioration of one extra 
handling of the coal by clam shell, 25 cents per ton, and the cost of delivery 
from terminal in Twin Cities to coal yard or carload consumer 25 cents per 
ton. These arbitrary charges assumed to exist, load the coal traffic with 75 
cents per ton tax and are sufficient to kill this project so far as carrying coal 
is concerned. We think the assumed charges are arbitrary and can be 
demonstrated to be erroneous. As hereafter shown, the coal can be handled 
at the river terminals from barge to dock or stock pile for a maximum of 
3 cents per ton and from dock to railway car, including screenings, for a 
maximum of 10 cents per ton; that the diminution in value of coal by extra 
handling by clam shell from barge to dock or stock pile is so small as to 
amount to nothing at all and is fully offset by the shaking up of the coal 
when carried in a bumping box car from the Lakes to the Twin Cities, a dis¬ 
tance of from 150 to 170 miles. This item of alleged deterioration of coal is 
fully discussed in the correspondence from the Bureau of Mines of the United 
States and the report of the Ohio Coal Commission, later herein fully referred 
to and quoted from. The item of 25 cents per ton for delivery from river 
terminal to coal yard or carload consumer is equally nonexistent. Only a 
very small percentage of the total coal consumed in the Twin Cities is de¬ 
livered in carload lots on industrial tracks to actual carload consumers. As 
to such deliveries there would be a switching charge of $2 per car from river 
terminal to sidetrack amounting to 5 cents per ton. As to all other coal 
consumed in the Twin Cities the delivery would be direct from barge to 
stock pile situate right in the coal yard. Notwithstanding the statement of 
the local board to the contrary, there is ample room in each of the Twin Cities 
adjacent to the river banks for all the coal yards required to supply all coal 
consumed in the Twin Cities, and they would be at once installed to take ad¬ 
vantage of the lower rates afforded by the canal. Guaranty of installation 
of proper terminals and coal yards can and will be made by the commercial 
organizations and business men of the Twin Cities to the satisfaction of the 
general board. As to coal reshipped by rail from Stillwater, Hastings, and 
other Mississippi terminals and the Twin Cities, the rate would be covered 
by the new distance tariff law enacted in Minnesota in 1913 instead of the 
through rate from Duluth to interior points in Minnesota. So that the canal 
coal would not be prevented by discriminating rates in favor of railways from 
going forward to interior points. The cost of screening coal and loading 
cars at river terminals would not be greater than similar cost of loading cars 
at the docks at Duluth-Superior. 


142 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER, 


As these errors are vital to the question of commercial feasibility of the 
enterprise—and indeed of all other inland waterway projects—and are the 
principal factors in the failure of the local board to find this project com¬ 
mercially feasible, we have given this subject careful detailed study, have 
obtained the estimates of the engineers of the leading manufacturers installing 
coal-handling and other freight-handling plants in this country, and collected 
available data of leading Government and transportation authorities, of which 
the following is a summary in outline: 

( a) The Chief of Engineers, United States Army (p. 894, 1912 report) : 

“ One large consumer transports coal by river a distance of about 50 miles 
at a cost of less than 10 cents a ton, including all charges, while the correspond¬ 
ing railroad freight rate is 45 cents a ton.” 

As will be seen by subsequent testimony of the United States engineers’ 
office at Pittsburgh, hereafter appended, it was specifically understood that the 
phrase “ including all charges ” covered loading and unloading charges. Of 
course, it is apparent that a cost of less than 10 cents to cover transportation plus 
loading and unloading leaves only a small percentage of the local board esti¬ 
mate of 25 cents at each end of haul—possibly 2 cents or 3 cents per ton at 
each end—as actual cost of loading and unloading river barge. 

( b ) Report of Lieut. Col. Mason M. Patrick, Corps of Engineers, United 
States Army, (p. 6 of Statistical Report of Lake Commerce passing through 
canals at Sault Ste. Marie, Mich., and Ontario, during season of 1912) : 

Under the head of “ Transportation charges, including loading and unload¬ 
ing, on freight passing through canals at Sault Ste. Marie, Mich., and On¬ 
tario, for the season of 1912,” we find as the first tabulated item: “ Coal, 
short tons 14,931,594, rate per unit, 30 cents.” 

It is apparent that with only 30 cents per ton as the lake boat cost of trans¬ 
portation, “ including loading and unloading,” from Lake Erie to Lake Superior, 
that again the actual cost of loading and unloading at the two ends of the 
route must be substantially less than the 25 cents at each end accepted by the 
local board. 

(c) New York Harbor handles more coal than any other port on the globe. 
Coal destined for Manhattan Island, Long Island, Staten Island, and other 
parts of Greater New York, necessarily is delivered by water, the coal trains 
unloading at various points on the mainland at distances of 2 to 20 miles from 
the metropolitan docks, and brought to city wharves (sometimes by train 
floats), but usually in 500 to 600 ton barges. New York, therefore, offers a 
prime object lesson of the commercial feasibility of water delivery of coal. 

F. W. Saward, manager of the Coal Trade Journal, a recognized coal trade 
authority of general and long standing in America, in a letter of October 4, 
3913, addressed to the writer (see Exhibit 5), estimates the total coal tonnage 
received at New York Harbor as approximating 40,000,000 tons per annum; 
and estimates cost of unloading from boats with modern machines as “ of 
itself a small matter, amounting to 3 or 4 cents a ton.” 

(d) Secretary of Commerce William C. Redfield, in a recent informal 
address before the convention of naval architects and marine engineers, gave 
the result of a statistical inquiry which he instituted to ascertain what per¬ 
centage of the 30 cents per ton cost of transportation by lake from Lake Erie 
to Lake Superior represented cost of handling at the two ends. The net 
result of his inquiry, based on careful analysis of the various items of cost, 
was that approximately 6 cents represented cost of coal and ore handling at the 
two ends of the round trip, out of the 30 cents total. Detailed figures, doubt¬ 
less may be obtained from Secretary Redfield. 

(e) C. W. Hunt Co. (Inc.), manufacturers of coal-handling machinery at 
West New Brighton, N. Y., have furnished detailed estimates of cost of loading 
and unloading on and off barges at lake and river terminls, accompanied by blue¬ 
print sketches of various proposed types of loading and unloading plants suit¬ 
able to the Lake Superior-Mississippi River canal-and-river project, as designed 
and prepared by Assistant Chief Engineer Fred E. Murphy, who rendered like 
service for this company in connection with the installation of the coal-handling 
plants of the General Government at the Isthmian Canal at Panama. 

This company has furnished coal-handling machines for a large percentage 
of the United States Government and foreign Government coaling stations, as 
well as for harbors on the Great Lakes, including Duluth-Superior. 

Exhibit 6 attached contains specifications and blue-print sketches of four 
different types and capacity of coal-handling plants recommended for use at 
various ports connected with the project. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 143 


Proposition 1 covers first cost and total operating cost of plant for unload¬ 
ing coal from lake barges and reloading into canal barge, with capacity of 500 
tons per hour, 5,000 tons in 10-hour shift, and 800,000 tons in 1G0 ten-hour 
days; cost of handling per ton, including operating and fixed charges, 2.715 
cents. 

Proposition 2 covers a small coal-handling plant for unloading and conveyance 
to storage at river and canal ports. The $8,000 plant unloads from river barge 
at the rate of 50 tons an hour and conveys to storage a distance of 500 feet from 
the stream at a cost of 3.93 cents per ton, including operating and fixed charges. 

Proposition 3 is planned for a larger unloading river terminal, such as 
might serve a city of the size of St. Paul or Minneapolis. It unloads at the 
rate of 750 tons an hour, or 1,200,000 tons for the season of open navigation, 
conveying the coal on a 30-foot trestle a distance of 1,200 feet inland at a total 
unloading and transfer cost, including all operating and fixed charges, of 2.91 
cents per ton. 

Proposition 4 covers a more complex plant of 500 tons per hour capacity, 
which unloads from boats, transfers to storage pile or to railroad cars, reclaims 
from storage pile, and reloads to cars or barges, at an unloading cost of 1.95 
cents, at a transporting cost of 1.56 cents, and at a reclaiming cost of 2.87 
cents, or, combining all of these various operations, which would be necessary 
in case of ultimate delivery of coal by rail, at a total of 6.38 cents, covering 
all operating and fixed charges. 

As touching the point of damage to coal in handling, Engineer Murphy 
reports that the percentage of damage as handled by these plants will be very 
small, and that in the case of steam-boiler coal the breaking is of no disad¬ 
vantage, because “it is necessary to crush run-of-mine coal before it can be 
economically fired by automatic stokers.” 

It will be noted in the above that the plant and cost of operation for transfer 
of coal from lake barge to canal barge, or unloading from river to dock, is much 
more simple and less expensive than in case of storage and transfer to railroad 
trains. 

Applying plants 1 and 3 to Duluth-Minneapolis haul of 262 miles by canal 
and river, total charges are: Lake handling, 2.715 cents; haul, at 1.5 mills 
per ton-mile, 39.3 cents; unloading and delivery in storage 1,200 feet from river, 
2.91 cents—total, 44.925 cents, against 90 cents to $1.25 by rail. 

(/) The Brown Hoisting Machinery Co., manufacturers of coal and ore 
handling machinery, main works at Cleveland, Ohio, with New York, Pittsburgh, 
Chicago, and San Francisco branches, and among the leading companies install¬ 
ing coal and ore handling plants on the Great Lakes, including Duluth-Superior 
Harbor, submit catalogues and photographs of plants, and offer to furnish de¬ 
tailed data. The New York manager, in letter of October 23, 1913 (Exhibit 7), 
says of unloading cost: 

“In reference to cost of unloading, this depends upon the circumstances 
under which the unloading is done; that is, whether the coal is simply brought 
to a bin on the edge of the dock or carried back to a stock pile. It also de¬ 
pends somewhat on the vessel, as to the size of the hatches and convenience 
of getting at the coal. We would say that this cost would be from 2 cents 
to 5 cents a ton, and in some cases may exceed this price of 5 cents.” 

Inasmuch as in unloading from lake boat into pocket at the edge of the 
deck for transfer by chute into canal boat at the foot of the pocket would 
entail the minimum of distance and labor of machine in transfer, whereas 
unloading for transfer to stock piles on shore and reloading upon trains entails 
a maximum of distance and labor of handling machinery, the cost of 2 cents 
per ton would likely apply to use of canal boat, while the 5 cents or over would 
apply to rail transportation. 

\g) The McMyler Interstate Co., Cleveland, Ohio, manufacturers of ore and 
coal handling machinery, orange-peel, clamshell, and scraper buckets, car 
dumpers, and locomotive cranes; also one of leading manufacturers of such 
machinery at Great Lakes and ocean harbors, submit (see Exhibit 8) photo¬ 
graph and estimate of unloading cost for plant suitable for unloading from 
lake vessel to canal barge and from canal barge to dock at canal or river 
terminals, and state: 

“ We estimate that cost of unloading under these conditions should not exceed 

2 cents per ton for labor, fuel, and repairs. This does not include interest on 
first cost of machinery and wharf.” 

If 1 cent per ton be added for fixed charge on plant, the total would reach 

3 cents per ton, as against 25 cents arbitrarily used by local board. 


144 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


(h) Mead-Morrison Manufacturing Co., New York, recognized as among 
leading corporations engaged in manufacture and installation of coal handling 
and hoisting machinery, submitted estimates (see Exhibit 9), catalogues, and 
photographs of plants installed by them at Duluth-Superior and other leading 
ports. 

On the proposition of a large coal unloading and storage plant at Duluth- 
Superior, similar to those now installed for lake-to-rail transportation, with 
capacity of 1,000 tons per hour and 1,000,000 tons per season, and 500,000 tons 
storage capacity, total plant to cost $1,000,000—labor and fuel cost 3 cents per 
ton, and interest, depreciation, and repairs raise this to 7 to 12 cents, according 
to tonnage handled. The above approximates the cost involved in transporta¬ 
tion by rail, without giving the railroad company dividends on capital outlay. 

Similar cost per ton is estimated for plant with storage capacity at Minne¬ 
apolis and St. Paul terminal. 

Unloading from canal barge with $7,000 plant at river dock is estimated at 
4 cents per ton. 

( i ) Link-belt Co., which has extensive manufacturing plants at Philadelphia, 
Chicago, and Indianapolis, and sales offices at 16 cities, of which Minneapolis, 
in proposed canal zone, is one, furnished catalogues descriptive of large variety 
of coal, coke, ore, cement, sand, and stone carriers, unloaders, tipples, and 
general link-belt conveyor machinery such as are used in mines, mills, power 
stations, and harbors throughout the country, including plants in operation in 
St. Paul, Minneapolis, and other cities in canal zone. 

In informal conversation, New York manager estimated cost of handling at 

3 to 5 cents for such conditions as those involved in unloading and loading coal 
and other bulk commodities at ports of Lake Superior-Mississippi River trans¬ 
portation project, with due increase in ultimate ton cost for extended conveyance 
through storage and manufacturing plants. 

(;) New York Edison Power Co., said to be largest single consumer of coal 
in New York City, with annual consumption estimated at 750,000 tons, unloads 
coal from 500-ton river barge, hoists it to a height of ISO feet, crushes it for 
automatic stoker, weighs coal and conveys it by cable car to storage bins in 
upper floors of power station for gravity stoking, at a labor and power cost 
estimated by Chief Mechanical Engineer Grady of 2 cents per ton, and of about 

4 cents including fixed charges. 

Estimates of engineers for large power plants generally in New York ap¬ 
proximate 3 cents per ton for operating cost and 4 to 5 cents including inter¬ 
est, depreciation, and repairs. These plants are necessarily more elaborate and 
expensive, both in first cost and in operating cost per ton, than plants required 
for loading and unloading canal and river boats on Lake Superior-Mississippi 
River project. 

( k ) Superintendent of ferries, city of New York. The department of docks 
and ferries for the municipality of New York has a coal-handling plant (see 
Exhibit 10) with 1-ton clamshell bucket which hoists coal from 600 and 800 
ton barges a distance of 80 feet, weighs coal and discharges it into a pivoted 
bucket conveyor which travels 150 feet in distributing coal in bunkers. The 
plant is not operated on commercial basis, because the city demand of 65,000 
tons for ferries requires use of plant for only partial capacity. The superin¬ 
tendent of ferries (Exhibit 10) estimates present handling cost at 5.3 cents per 
ton, which interest and depreciation on investment would increase to 8.4 cents. 
By operating plant at full eight-hour day, the superintendent estimates reduc¬ 
tion of ton cost of handling to 4.1 cents. 

(l) United States engineer office, Pittsburgh, Pa., furnishes the record for 
the lowest cost of coal handling from river barge or otherwise. In statement 
prepared by Asst. Engineer Thomas P. Roberts, who has for many years served 
as local engineer in charge of Locks and Dams Nos. 1 to 6 on Monongahela, 
including Pittsburgh Harbor, and herewith gives data (see Exhibit 3) supplied 
to the engineers office at Pittsburgh by companies handling coal from river 
barges at that point. Says Engineer Thomas (sec. 4 of Exhibit 3) : 

“ We have on the Monongahela, in pool No. 1, a double ladder coal dredge 
unloading 500 tons per hour, raising it about 70 feet, and transferring the coal 
by an endless belt several hundred yards to the cars which distribute the coal 
to the coke ovens for a cost of one quarter of a cent per ton. This is only about 
one-twelfth the cost of simply raising the coal with a clam shell to the height 
of 70 feet.” 

Presumably this one-fourth cent covers cost of operation only, and does not in¬ 
clude interest and depreciation. Subsequent data procured by Engineer Thomas 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 145 


(see Exhibit 3) shows that the cost of the Monongahela plant named is $40,000, 
and that its capacity is 600 tons per hour. If we assume that interest, deprecia¬ 
tion, and repairs on such plant would reach 15 per cent, or $6,000 a year, and 
that the plant runs at 500 tons capacity per hour, eight hours daily for 200 days 
in a year, handling 800,000 tons annually, the fixed charge would be three- 
fourths cent per ton, making 1 cent per ton as total cost of unloading from river 
barge, hoisting 70 feet, and transferring to coke ovens several hundred yards 
distant from stream. 

There is little question that the Mopongahela River and Pittsburgh Harbor, 
where coal handling has been specialized by long experience at the hands of 
large industrial companies, the rate of coal handling cost has been reduced to 
the minimum and is lower than can be expected at docks of proposed Lake 
Superior-Mississippi River lake and river terminals for many years. Handling 
cost of 3 to 5 cents per ton is, however, a reasonable average for which there is 
general consensus of authority; and on this basis the commercial feasibility of 
coal handling by canal and river on said project is amply assured, as compared 
with admitted cost by rail. 

DATA SHOWING LOW COST OF COAL HANDLING AS GIVEN BY LOCAL BOARD. 

38. Above data with reference to record low cost of coal handling from 
Monongahela River barge to coke ovens as contained in Exhibits 3 and 4 is 
forwarded to the Minnesota commission from the United States engineer’s 
office at Pittsburgh. 

Said local board also furnishes direct official data of cost of coal handling 
from boat to dock at Duluth-Superior Harbor in Appendix C of their report, 
being data contributed by J. A. Little, city statistician of the city of Superior, 
in the harbor of which the canal will have its northern terminus. This state¬ 
ment of fact by Mr. Little loses none of its force by reason of his position in 
trying to prove that West Virginia coal can not be profitably delivered in St. 
Paul via the Lakes. 

By way of verification of Statistician Little’s figures, to make certain that 
they are not the result of typographical error, I quote his calculation of cost 
from West Virginia mine to St. Paul, as follows: 

“ Mine cost 86 cents, plus transportation expenses of $2 through Superior to 
St. Paul, makes West Virginia coal worth $2.86 per ton, plus cost of handling 
at Superior-Duluth docks (3 cents ton boat to dock, plus 10 cents from dock to 
car), 13 cents would mean a total cost of $2.99 a ton at St. Paul.” 

So far as Mr. Little’s theory is concerned, it is disproved by the actual 
tonnage of lake coal which has given the Twin Cities its chief fuel supply for 
years and is yearly increasing—the net increase being about 50 per cent in five 
years. But as regards the handling cost in question, Mr. Little’s figures are 
vitally pertinent, not only because of the stated cost of 3 cents per ton from boat 
to dock, but by reason of the collateral fact, that the wst of handling from 
dock to car is 10 cents, making 13 cents as boat-to-rail cost, against 3 cents 
when the rail transfer is omitted. 

DETERIORATION IN MARKET VALUE OF COAL INVOLVED IN ONE EXTRA HANDLING OF 
COAL BY CLAM SHELL OR OTHER LIKE MEANS. 

39. The local board of engineers has assumed, from statements made to it 
by coal dealers at the head of the Lakes, that one extra handling of coal causes 
a deterioration in the market value of the coal of 25 cents per ton. No reliable 
authority or evidence of any tests is quoted to sustain such statement. Coun¬ 
sel for the Minnesota commission has made very extensive inquiry of the coal 
mining companies of West Virginia, Maryland, Pennsylvania, and of the United 
States Bureau of Mines and the department of mines of several States on this 
subject. The coal mining companies have not responded to the inquiries and 
have referred counsel to the president of the Northwestern Fuel Co. for the 
information in question. So far no information has been received through the 
coal mining companies or large dealers in coal. 

From letters received from the United States Bureau of Mines it appears 
that there is no authority for the statement that deterioration amounts to 25 
cents per ton or any given sum. Owing to the prominence that has been given 
to this charge we quote from the letters of the Bureau of Mines as follows: 


H. Doc. 1008, 64-1-10 



146 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


“ The bureau is not aware that any definite measurements have ever been 
made to determine the amount of deterioration in the market value due to 
handling bituminous coal between the eastern coal fields and the upper lake 
region. In fact, information on the deterioration of bituminous coal between 
mine and user is very meager. 

“ This is probably due to the difficulty and great expense in making an inves¬ 
tigation of this sort. To give a proper reply would require that the coal in a 
large quantity, such as a cargo of 6,000 tons, should be followed from the face 
in the mine to the boiler room of the user, and at each new handling the whole 
product should be sized through screens and returned to its original mixed 
condition. This operation of screening the coal in order to find the relative 
proportions of each size would in itself damage the coal in a manner unusual 
in practice and would, therefore, give unreliable values for subsequent hand¬ 
lings. The coal is shoveled into cars at the face in the mine, is dumped from 
cars at the tipple, drops from the tipple into railroad cars, is handled from 
railroad cars into pier cars at the loading docks; from the pier cars it drops 
into coal pockets; from the coal pockets it drops into boats; from the boats 
it is reclaimed by buckets, dropped from buckets either into cars or stock piles; 
drops from stock piles into railroad cars; drops from railroad cars into local 
storage piles, is shoveled from local piles into boiler room cars, and is rehandled 
in the boiler room. 

“ This operation makes at least 12 handlings, and in some cases several more 
are added. It is rare that every one of these operations is conducted in the best 
possible manner to reduce breakage. In fact, the question of breakage in han¬ 
dling devices is by no means the first consideration. Any careful investigation 
of this subject, therefore, would require the handling of a great many tons both 
before and after each operation. 

“ Some such work has been done in some of the operations with hard coal 
which stands screening much better than soft coal, but even in this case the fine 
material is not returned to the original mass where it would have an effect on 
succeeding operations. Having separated our soft coal into the several sizes in 
order to determine the degradation of sizes, it would be extremely difficult to 
recombine the several amounts so that their effect on subsequent handlings 
would be normal. 

“ The problem is further complicated by the considerable difference in the 
strength between different coals, some coals standing considerable more abuse 
in handling than other coals. If the coal is stocked in piles through the winter 
at upper lake ports, the freezing and thawing adds another large and variable 
factor to the problem. 

“ Even if it were possible to express in figures the degradation in size, it 
would be yet more difficult to state what the deterioration in market value was. 
The mere fact that coal which starts from the’ mine as good lump coal finally 
reaches its destination with a considerable portion of fine material in it, would 
not warrant the buyer in assuming that the value of the fine stuff was that of 
slack. Slack coal at the mine contains a larger per cent of ash and impurities 
than the lump coal, while the fine stuff made from the breakage of lump coal 
has a heating value equal to the original lump coal. Whether this heating value 
can be efficiently realized in practice depends entirely upon the equipment of the 
boiler plant where it is used; that is to say, if all plants at upper lake ports 
were equipped to efficiently use fine crushed bituminous coal, such as is used in 
many stoker equipments, there would be no deterioration-in the market value 
due to breakage of the coal in transit. 

“ Very truly, yours, 


“ J. A. Holmes, Director” 


“ The bureau is unable to furnish any information on the subject of deteriora¬ 
tion of coal in handling other than that contained in its letter of March 11. 

“ It may be pointed out that coal as usually handled has passed through some 
12 or more operations, and if each of these operations reduced the value of the 
coal 25 cents per ton it is readily seen that the price at destination would be 
something less than nothing. It is hardly to be supposed, therefore, that the 
addition of one more handling from lake bottom into coal barges would dete¬ 
riorate the value as much as 25 cents per ton.” 

A great deal of light is thrown upon this question by the report of the Ohio 
Coal Commission to the governor of the State of Ohio, dated December 17, 1913. 
One of the main questions considered by that commission was the question of 
whether miners of the State of Ohio should be paid on the “ mine run system ” 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 147 

or whether the system of paying miners for the amount of coal which would pass 
over 1^-inch screen should be continued. In the consideration of that question 
the commission made investigations and took testimony, not only at the mines 
and as to the conditions of mining but as to the operations involved in the han¬ 
dling of coal from the face of the mine to the consumer, and among other things 
took testimony of expert coal men familiar with conditions at the head of the 
Lakes and entire Northwest with reference to lump coal, slack, and the condi¬ 
tions which produced slack or fine coal. If the board will read pages 43 to 60 
of the report of the Ohio commission, it will inevitably conclude that if the coal 
is properly mined in the first instance, that is, if it is not “ overshot ” but is 
undercut by machinery and shot with a proper charge of powder, the liability of 
the breakage of the coal in handling is reduced to a minimum; but any of the 
Ohio, Pennsylvania, or West Virginia coal which is overshot or blasted with too 
heavy a charge of powder will produce a large percentage of slack in the various 
handling operations to which it is necessarily subject in being taken from the 
mine to the consumer. 

It appears from the report of the local board, as well as from the testimony 
taken by the Ohio commission, that when the coal is received at the docks at 
Duluth-Superior it is screened before being stored or shipped by car, and in all 
probability the 25 cent per ton deterioration mentioned in the report of the local 
board is the deterioration due to the entire process of carrying the coal from the 
face of the mine to the dock, involving, as it does, from a half a dozen to 10 han¬ 
dling operations. There is nothing in the report of the local board or any of the 
evidence or statements received by the board which indicates that the one 
extra handling involved in transportation of coal by canal barge, which han¬ 
dling occurs before the coal is screened, should have any more effect on the de¬ 
terioration of the coal than any one of the other handlings of the coal neces¬ 
sarily involved in transporting the coal from the mine to consumer. The con¬ 
clusion seems to be inevitable that the assumed deterioration does not exist 
and that the deterioration, if any, is so slight as to be commercially negligible 
and is fully offset by box-car transportation from Duluth to the Twin Cities. 

COAL PRINCIPAL COMMODITY OF WATERWAYS AND CANAL. 

40. In the United States and Europe coal is one of the principal commodities 
transported on canals and waterways. On page 532 of the final report of the 
National Waterways Commission it is said: 

“ The foregoing analysis of the traffic carried on the principal waterways of 
Europe and the United States reveals the fact that a few bulky commodities 
form the great share of the tonnage. Among these, coal is the most conspicuous. 
In many cases it furnishes more than 50 per cent of the total traffic, and some¬ 
times as high as 90 or 95 per cent. The cases are rare on the principal water¬ 
ways where coal is not the largest single item carried.” 

Water rates on coal are usually the lowest of any commodity. We quote 
from the above authority on page 556: 

“ The average charge for the transportation of coal on the Rhine from Ruhrort 
to Mannheim, a distance of about 220 miles by water, for the nine-year period 
1901-1909, was 27.6 cents per metric ton. The lowest charge recorded during 
this period was 13.1 cents, which was made on a few consignments in 1908, and 
the highest charge was 58.8 cents, which was reached in the same year. The 
average yearly rate on this coal traffic was lowest in 1909, when it reached 18.3 
cents per metric ton. This was due to a large increase in the number of boats 
competing for the traffic, which more than offset the considerable increase in the 
traffic itself. 

“ The following table shows the average rates recorded for carrying coal dur¬ 
ing the last decade from the mouth of the Ruhr to Mannheim: 


Year. 

Rate per ton. 

Year. 

Rate per ton. 

Marks. 

Cents. 

Marks. 

Cents 

iom . 

1.05 

24.9 

1906. 

1.45 

34.5 

1Q09 . 

1.00 

23.8 

1907. 

1.61 

38.3 

i om . 

1.18 

28.1 j 

1908. 

1.10 

26.1 

1004 

1.23 

29.2 

1909. 

.77 

18.3 

1905. 

1.08 

25.7 





























148 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


The above figures are for metric tons of 2,240 pounds. Reduced to a ton-mile 
basis they are as follows: 


Per ton. 

Per metric 
ton-mile. 

Per ton- 
mile (2,000 
pounds). 

Cents. 

27.6 

13.1 
24.9 
18.3 
23.8 

28.1 
29.2 

25.7 

Mills. 

1.25 

.059 

1.13 

.083 

1.08 

1.27 

1.32 

1.16 

Mills. 

1.23 

.053 

1.11 

.074 

1.07 
1.25 
1.30 
1.14 


TRAFFIC FINDING A: CANAL WILL CARRY COAL. 

41. Coal takes a transportation rate 25 per cent less than average freight 
tonnage. Accepting Erie Canal standard of 2 mills per ton-mile as average 
freight, the coal rate should be 1.5 mills per ton-mile. Coal has actually been 
carried on Erie and Hudson 500 miles between New York and Buffalo, and that 
in 240-ton canal boats sometimes carrying only 160 tons per load, according to 
testimony of booking agencies, at 45 cents for trip, or nine-tenths of 1 mill per 
ton-mile. On Monongahela, Allegheny, Kanawha, and Ohio the average rate in 
500-ton barges appears to be not much over 1 mill per ton-mile. The rate on the 
Alabama project is two-fifths mill per ton-mile. To assume as a coal rate on 
Lake Superior-Mississippi River waterway by use of 550-ton barges 1.5 mills per 
ton-mile would therefore appear reasonable in light of practical experience on 
above-named 6-foot navigable waterways. 

Transfer from lake barge to canal barge via pocket bins—upper mouth of 
pocket being at edge of deck of lake vessel, and foot of pocket terminating in 
retarding chute which loads canal barges—affords the cheapest and simplest 
method conceivable of unloading lake vessel, and should cost, on basis of 
Pittsburgh and Great Lakes experience, not over 2 to 3 cents per ton. Lake 
vessels need not wait for canal barges but unload into pockets at pleasure and 
at all hours of day, canal barges being likewise independent of movement of 
lake vessels, except that canal barges must relieve harbor pockets within a 
reasonable number of hours. 

Unloading at river terminals probably can not be accomplished at 1 cent per 
ton rate achieved at Pittsburgh, but may reasonably approximate 3 cents, 
which should convey coal to cable line or storage bunker several hundred feet 
from river bank. 

This will make cost of transportation by canal and river 250 miles from 
Duluth to Minneapolis, taking from lake barge and delivering in Minneapolis 
storage near river front, at approximately 45 cents per ton for transportation 
and handling at both ends of route. One authority, Mr. Bernhard, reduces 
this to 25 cents per ton. 

As against 90 cents by rail on soft coal the saving by waterway would be at 
least 45 cents per ton, and as against $1.25 by rail on hard coal the saving would 
reach at least 80 cents per ton. 

Compared with Illinois rail rates of $1.40 to $2.10 from mines or from Chicago 
to Twin Cities, the Duluth-Superior coal moved by canal and river would have 
the superiority of 95 cents to $1.65 in transportation cost, besides the marked 
superiority in grade of lake coal. 

Present consumption of Minneapolis, St. Paul, Minnesota Transfer, and South 
St. Paul approximates from 2,500,000 to 3,000,000 tons. Other canal and river 
cities and counties in western Wisconsin and in eastern, central, and southern 
Minnesota will consume and distribute to country tributary at least 1,500,000 
tons additional, making present coal total for canal zone and territory tributary 
to Mississippi River distributing centers about 4,000,000 tons. Increased coal 
demand of territory and coal capacity of Duluth-Superior Harbor during esti¬ 
mated four-year period of building canal will expand coal tonnage available to 
upper Mississippi via Lakes to not less than 5,000,000 tons. Allowing railroads 
to haul from Duluth-Superior all of their present tonnage, with some annual in¬ 
crease, there will still be upward of 2,000,000 tons available to canal-and-river 








WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 149 


barges, at a saving of 45 to 80 cents on lake-and-rail rates, and much more 
than that margin as compared with all-rail rates from Chicago and Illinois 
mines. 

If the average ton saving on the total 2,000,000 tons carried by waterway is 
50 cents per ton, the total amount saved in hauling coal is $1,000,000 per annum, 
which is $580,000 more than the $420,000 required by the local board of engineers 
to demonstrate the commercial feasibility of the project. 

TRAFFIC FINDING B : CANAL WILL CARRY STEEL, CEMENT, AND MERCHANDISE. 

42. Investment of an ultimate total of $25,000,000 in model steel, blast fur¬ 
nace, coking, and cement industry by United States Steel Corporation at Duluth 
is for the evident supply of the upper Mississippi Valley and westward territory 
by that company of its various productions. Its Gary and South Chicago plants 
take care of the Middle West and the lower Mississippi Valley, which leaves Min¬ 
nesota, western Wisconsin, the Dakotas, and northern Iowa and Nebraska to be 
taken care of by the Duluth plant. Over one-half of the proposed 48 mills, 
ovens, furnaces, and auxiliary buildings are now approximately completed, and 
foundations are laid for the remainder, upon which a large force of mechanics 
are putting up the superstructures and installing machinery. The furnaces are 
ready for business, and a year will find the plant at least in partial operation. 

Slag containing lime refuse from the furnaces is converted into cement. The 
furnaces and cement works require large quantities of limestone, of which the 
limestone formations through which the upper Mississippi and lower St. Croix 
makes channels have an abundant supply. 

Annual tonnage of the Minnesota Steel Co. works at Duluth can only be 
roughly estimated at this time. It is conservative to say that the rail mills, 
merchant mills, structural steel mills, furnaces, and rolling mills will ship 
500,000 tons of their products per annum into the Mississippi Valley; probably 
1,000,000 tons may eventually be the annual shipment. Duluth works will sup¬ 
ply the various manufacturing subsidiaries of the Steel Corporation, such as the 
American Bridge Co. at Minneapolis and St. Paul, with structural steel, and 
other down-river points. The American Bridge Co. is likewise a builder of river 
barges and steel tow vessels, and will undoubtedly be in the market for canal 
and river equipment generally. 

As a builder of river and canal barges, it is natural that the Steel Corporation 
should use such equipment for its transportation purposes, as the company is 
doing both on the Monongahela and the Great Lakes. The Steel Corporation 
owns a fleet of 114 of the largest carriers on the Lakes and is using its own 
barges on the Monongahela and Ohio for handling its coal, iron, and steel. 
Along its 2 miles of water front on Duluth-Superior Harbor it is now building 
additional docks, and these could well serve to load canal and river boats for 
transportation of products through proposed canal link into the Mississippi. 

It is therefore fairly reasonable to suppose that Duluth-Superior will ship via 
the canal a tonnage of 500,000 or more of steel and cement. 

GENERAL MERCHANDISE. 

The purpose of New York City, through the New York Produce Exchange and 
Chamber of Commerce, representing the merchants, manufacturers, grain and 
produce interests of that metropolis, in supporting the measure for a 
$130,000,000 Erie Barge Canal and public terminals, is: 

First, to secure and hold for New York Harbor the grain, flour, and general 
produce of the Northwest, including the upper Mississippi Valley and Lake Su¬ 
perior region. 

Second, to furnish the Erie Canal barge fleets with return cargoes of general 
merchandise from New York and the Atlantic coast, including foreign imports. 

There is no question of the power of a largely improved and efficiently ad¬ 
ministered Erie Barge Canal with well equipped public terminals to develop 
a channel of commerce with the Great Lakes region. That is shown by the 
former achievements of the old Erie Canal, to which is attributed much 
of the vantage ground of New York Harbor over Boston and Philadelphia in 
the race for position of chief emporium of the Atlantic coast. 

As the largest share of the grain, flour, and general farm produce which New 
York invites will come from Duluth-Superior, the outlet of the agricultural 
shipments of Minnesota, North and South Dakota, and northern Iowa and Ne- 


150 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


braska, it is inevitable that the return cargoes of merchandise will seek Duluth- 
Superior Harbor for transshipment into the upper Mississippi Valley. 

As shown bv Exhibit 12 attached hereto, canal-and-lake rates over the Anchor 
Line from New York to Duluth-Superior, even with the present neglected equip¬ 
ment on the Erie, are about 25 per cent under the lake-and-rail rates. New 
York Canal authorities report that the new 2,000 and 3,000 ton barges on the 
enlarged Erie Canal will reduce the average ton-mile rate from the present 2 
mills to one-half mill per ton-mile. This marked reduction in transportation 
cost is bound to have its influence on volume of commerce handling. It means 
largely increased tonnage for Duluth-Superior Harbor. 

Moreover, American grain will soon cease to be exported to Europe, because 
the American production is required for American consumption. That means 
that the grain and flour now going to Montreal for export will go to the chief 
centers of domestic consumption, and as it takes the Great Lakes route for 
cheap transit this tonnage will naturally proceed via the new Erie Barge 
Canal to New York for eastern distribution. 

The result is the development via the lakes and canal of an extensive water¬ 
way commerce between New York Harbor and Duluth-Superior; and hence a 
substantial merchandise tonnage via the Lake Superior-Mississippi River Canal 
with the upper Mississippi Valley. 

Such heavy commodities as salt, sugar, cement, iron and steel, machinery, 
and likewise such staples as heavy cotton goods for Twin City manufacture 
into farm, mill, mine, and lumber clothing supplies, which now take the Great 
Lake route, will use the proposed canal-and-river line in largely increased 
volume. The New York through westbound merchandise tonnage plus that de¬ 
veloped by the big steel plant at Duluth should give the canal by the time it is 
finished an aggregate available freight of 1,000,000 tons. 

ECONOMIES ON THROUGH WESTBOUND AND LAKE SOUTHBOUND TONNAGE. 

43. On through westbound merchandise from New York Harbor via Erie 
Barge Canal, Great Lakes, and Lake Superior-Mississippi River Canal, there 
will be the following economies in cost of transportation and freight handling: 

(а) Public terminals and freight handling machinery provided by the State 
of New York, now being designed and installed, will reduce present rail ter¬ 
minal charges of 25 to 50 cents per ton at New York to actual cost of handling 
from dock to barge of about 3 cents per ton. 

(б) Rail to lake rate of about 7 mills per ton-mile on carload lots from New 
York to Buffalo will be reduced by new Erie Barge Canal to less than 1 mill 
per ton-mile. 

(c) Freight handling of such merchandise at Duluth-Superior which 
costs through rail terminals 25 to 35 cents can be transferred from lake vessel 
to canal barge via modern terminal plant suitable to dock practice at 3 to 6 
cents per ton. 

( d ) Transportation via canal and river to river terminals on Mississippi 
will be at 2 mills per ton-mile, compared with rail rate of 6 mills or more. 

(e) Delivery of freight from barge to dock and terminal warehouse at 
Minneapolis, St. Paul, and other river points can be made with modern gantry, 
telpher, and other freight-handling machinery at 3 to 6 cents per ton, according 
to distance of carriage and mode of storage; in lieu of the rail terminal cost 25 
cents and upward. 

The above economies are not net, because the rail rate may include part 
of the terminal costs. The differences in actual cost to carriers, however, 
are taxed upon the consumer in one or another method in the end. Con¬ 
versely, economies in actual cost of transportation and handling redound to 
the benefit of the consumer in the final analysis. Reductions in such cost by 
water route enable the waterway to secure and hold traffic. Restricting the 
saving by canal to 42 cents per ton as follows—52 cents for Duluth-Minne- 
apolis haul at 2 mills per ton-mile, plus 4 cents handling charges at lake and 
4 cents at river dock, total water line, 60 cents, compared with rail average of 
$1.02—would net on 1,000,000 tons the necessary $420,000 estimated by engineers 
as justifying the project. 




WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 151 


TRAFFIC FINDING C: CANAL WILL CARRY EASTBOUND FLOUR. 

44. Through merchandise from Great Lakes route and tonnage originating 
in Duluth-Superior Harbor, other than coal, will move on the canal and river 
in decked barges suitable for return eastbound cargoes of flour. 

Merchants and millers at Minneapolis, St. Paul, South St. Paul, Stillwater, 
Hastings, Red Wing and Winona may unite, as have those at Kansas City, 
in the organization of a canal-and-river navigation company for the operation 
and handling of their own freight line. In that case, barges coming from 
the lakes with merchandise would return to lakes with flour eastbound. 

Minneapolis now produces 18,000,000 barrels of flour, which is more than 
that of any other milling center in the world. This flour production will 
annually increase; by 1918 it will be 20,000,000 barrels. Other mills in canal 
and river territory will swell the total to somewhere near 30,000,000 barrels, 
of 3,000,000 tons. Via the river, the canal link, the Lakes and the Erie Barge 
(’anal and New York public terminals, this flour tonnage can go to New York 
Harbor at much less than the rail rate to Chicago, and at less than one-half the 
all-rail rate to Atlantic. 

The local board of engineers apprehended that to deliver this flour from 
mill to river barge would entail a terminal rail handling cost of 35 cents per 
ton, which would practically wipe out the margin of reduced cost of water 
transportation to the lake. However, it appears that such terminal rail 
handling is unnecessary. 

The American Steel & Wire Co., which at the Trenton Iron Works manu¬ 
factures air cable lines, or aerial tramways, under German patents, furnishes 
specifications (see Exhibit 13) for a cable plant that will take the flour from 
the Minneapolis mills on the river banks, carry it down river a half mile or 
more and deposit it in a barge at a cost of 3.6 cents per ton, including all operat¬ 
ing and fixed charges. 

About 4,000 of such plants are now in successful operation, engaged to 
handle similar situations, where engineering difficulties and rail costs are 
prohibitive by ordinary transportation methods. One of such plants has been 
in successful operation between the mill and elevator of one of the big milling 
companies of Minneapolis for several years. 

At Duluth-Superior Harbor a belt conveyor will transfer the flour from canal 
barge to lake vessel at similar cost. 

Allowing 4 cents for loading and unloading by modern machinery at river 
and the same at the lake, or 8 cents, plus 2 mills per ton-mile Minneapolis to 
Duluth-Superior, 52 cents makes 60 cents by barge compared with average $1.02 
by box car, a saving of 42 cents per ton. This economy applied to 1,000,000 tons 
of flour, being only one-third of the total flour tonnage, would produce the total 
$420,000 economy necessary to justify the project. 

TRAFFIC FINDING DI CANAL WILL CARRY NORTH AND EAST BOUND GRAIN. 

45. Grain from Duluth-Superior Harbor goes by lake to Montreal and is 
loaded on ocean vessels by floating elevators at a total of 4£ cents per bushel 
from Minnesota and Wisconsin harbor to ocean liner. 

The New York Produce Exchange is preparing to duplicate this charge via 
Erie Barge Canal. Harbor-loading charge on ocean vessel in New York is now 
one-half cent per bushel. 

From Minneapolis and other primary and local grain markets to Duluth- 
Superior wheat moves at 3 cents per bushel, or $1 per ton, by rail, as compared 
with one-half that ton-mile rate in 240-ton barges on the old Erie Canal—a sav¬ 
ing of 50 cents a ton. 

Surplus grain in Minneapolis, St. Paul, Stillwater, Red Wing, and Winona 
elevators, over and above local milling demands, with similar elevator charges 
by rail and water, will take by preference the 50-cent water rate, as compared 
with $1 rail rate. 

Elevators will adapt their locations and terminal arrangements, so far as 
new plants are concerned for additional tonnage, to waterway transportation; 
and in the absence of such changes by line elevator companies, cooperative 
farmers’ elevators will take advantage of the low transportation cost by water 
to handle their products, as now frequently occurs even along the railroads. 

At river points where elevators are not available grain will flow by chute 
or move in cable buckets from overhead tracks to barge at 2 to 5 cents per ton. 


152 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Floating elevators or belt-line conveyors will transfer grain from barge to 
lake vessel at materially less than the usual elevator charge. 

Local board of engineers fears that Chicago rail route may get coarse grain 
in Minnesota and western Wisconsin, even on a rail charge of $2.50 per ton 
from La Crosse to Chicago. Their difficulty lies (1) in loading the water 
route with 44.4 cents per ton loading charge at La Crosse and 44.4 cents more 
for unloading at Duluth-Superior, and (2) in hauling the grain around from 
Lake Superior through Lake Michigan to Chicago (a route it would not take), 
when the same cost of lake transportation would deliver it in Erie barges at 
Buffalo, destined to New York, where it is worth 6 to 8 cents per bushel, or 
$2.50 to $3 per ton, more than it is at Chicago. 

Granting that all grain raised north and west of a straight line from south¬ 
western Minnesota to Duluth and tributary to said line would take the through 
rail route to Duluth, there remain a large group of Minnesota counties in east¬ 
ern, central, and southern Minnesota, besides a double tier of western Wiscon¬ 
sin river and canal counties, and likewise a further group of grain-producing 
counties in northern and northeastern Iowa. The total grain production of 
this region approximates 240,000,000 bushels. Assume that two-thirds of this 
total product of wheat, corn, oats, rye, flax, buckwheat, and barley is required 
for home, mill, and live-stock consumption, there remain, reduced to tons, 
2,000,000 of surplus grain tonnage for river and lake, or for Chicago rail 
shipment. This grain is either tributary to the Mississippi or must cross that 
stream to get to Chicago. The central point of this tonnage territory where it 
crosses the river is about equidistant, say 300 miles, from both Chicago and 
Duluth-Superior. 

The engineers give $2.50 per ton as the rail charge to Chicago. 

The Erie rate of 2 mills per ton-mile for 300 miles is 60 cents. 

Will the grain go via Duluth-Superior and the lakes to New York, where 
it can make the entire water trip to New York Harbor for a ton rate equal to 
the rail rate to Chicago, or will it go to Chicago and be worth to the shipper 
6 to 8 cents per bushel less than it is in New York? 

Even granting that the water route entails two transfer charges of one-half 
cent per bushel at each transfer, the advantage to the shipper is 5 cents per 
bushel in favor of the water route. 

If the river divided this surplus tonnage with the rail route, the margin of 
saving on 1,000,000 tons would alone more than produce the $420,000 a year 
necessary to demonstrate the commercial feasibility of the river and canal 
improvement. 

TRAFFIC FINDING El CAN AX WILL CARRY NORTHBOUND COMMODITIES. 

46. Besides grain and flour, the river and canal will carry sundry north¬ 
bound commodities from Mississippi Valley to Great Lakes: 

Limestone from limestone ledges which form river banks of upper Missis¬ 
sippi and St. Croix. 

Building stone from stone quarries that will develop among the hills bound¬ 
ing the St. Croix. 

Brick from numerous brickyards on St. Croix and upper Mississippi. 

Tile from Red Wing and other tile works on rivers for drainage of swamp 
sections on upper Wisconsin and Minnesota Rivers and in lowlands suitable 
for truck farming. 

Commercial fertilizers from South St. Paul packing houses, which will find 
its best market in market-gardening districts of lower lakes and in New York 
and New England. 

Oil cake from the Twin City linseed oil mills for export and for eastern 
consumption, the Twin Cities being the leading linseed oil and cake manufactur¬ 
ing district of the world. 

Potatoes from sandy farm-land section of eastern Minnesota and western 
Wisconsin for Great Lakes and Duluth-Superior steel mill and iron mine 
districts. 

Bran, shorts, and general mill feed for Ontario, lower lakes, and eastern 
dairy regions. 

Hay from meadow sections of St. Croix Valley, baled for Great Lakes cities 
and for dairy and live-stock districts. 

Agricultural implements from Minneapolis-St. Paul implement houses, which 
carry the largest implement business of any distributing center in the world. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 153 


Binder twine and farm machinery from Minnesota State Prison at Still¬ 
water, which is one of the largest plants in that line of goods and operated 
by the State to give farming sections low-priced and reliable wares. 

Hardwood and pulp-wood lumber from St. Croix wooded region for eastern 
consumption. 

These staple commodities in the aggregate will make a heavy and dependable 
tonnage local to the river and canal and a little subject to general rail com¬ 
petition over the route from origin to destination of the respective shipments. 
There should never be less than 1,000,000 tons per annum in the aggregate 
of these commodities available to the river and canal route. Development 
of the waterway will in itself develop these industries. 

These miscellaneous heavy commodities will furnish return cargoes to the 
lake for the open coal barges which will supply the Twin Cities and all other 
upper Mississippi manufacturing and large population centers with fuel; 
cheaper coal will stimulate manufacturing enterprises, resulting in increased 
commerce. This tonnage gives the Lake Superior-Mississippi River project 
a marked advantage over the Monongahela and Allegheny, which have no 
return cargoes for their coal boats. As a consequence, transportation cost on 
these Pennsylvania coal-carrying streams has to include the round trip with 
return of empties, with no earnings for the return voyage, whereas the Lake 
Superior-Mississippi barges will have revenue freight both ways. 

With coal barges southbound from lake and above-named commodities for 
northbound fleets an average of 1.5 mills per ton-mile will be assured each 
way, as compared with 6 to 7 mills by rail. A saving of 4 to 5 mills per ton- 
mile on an average 200-mile haul on 1,000,000 tons would insure the com¬ 
mercial feasibility of the project from every point of view, regardless of all 
other classes of tonnage available. 

TRAFFIC FINDING F: CANAL WILL CARRY THROUGH COMMERCE LAKES TO GULF AND 

NORTH AND SOUTH AND VIA PANAMA. 

47. Because of diversity of climate, seasons, people, and productions, nature 
and the laws of supply and demand intended commerce between North and 
South, between North Temperate Zone and Tropics. A century of slavery fol¬ 
lowed by a half century of sectional feeling and race prejudice, made bitter 
by Civil War, interrupted that law of trade for generations in this country. 
That period is now past. Commerce will now return to its own in the revival 
of trade relations between the great empire tributary to the Gulf and the 
equally vast industrial empire of the Great Lakes region. 

All that is required is the development of the necessary channels of com¬ 
merce and routes of transportation. The General Government has started 
upon the revival of this commerce by appropriating something like $60,000,000 
in the aggregate for a permanent and reliable channel of navigation from Min¬ 
neapolis to the Gulf of Mexico. But through commerce into the Great Lakes, 
which carry the greatest tonnage in the greatest merchant fleet floating the 
American flag, is necessary to put the great arteries of North and South com¬ 
merce into complete and normal circulation. Commerce does not flourish on 
dead ends of trade channels. Trade circulation begins when the dead ends are 
punched through to complete the circulatory system. When Lake and Gulf 
meet, then true commerce between North and South begins in earnest, and the 
barges of the great Mississippi will carry full cargoes. 

Of a total of 90,000,000 tons of Great Lakes commercial freight, 72,000,000 
tons, or 80 per cent, passes through the Soo canals to or from Lake Superior. 

This demonstrates that the logical destination of a Lakes-to-the-Gulf through 
waterway is a link joining the Mississippi River with Lake Superior. 

The St. Croix River is the direct north and south tributary of the Mississippi 
and rises within 20 miles of Lake Superior. It therefore affords the natural 
channel of canalization between lake and river. This is the route declared by 
United States engineers as most feasible for uniting the greatest river of our 
continent with the greatest lake. 

No one can estimate in advance what tonnage will develop in a revival of 
commerce between North and South, between Lakes and Gulf, between the 
Mississippi Valley and the Pacific via the Panama Canal. It is a matter which 
future development only can determine. The same is true, however, in regard 
to the tonnage which will pass the Panama Canal. Foresight and faith are 
the basis for such enterprises. Faith in the development which should follow 
the linking of Atlantic and Pacific has caused this country to venture on an 


154 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


investment of $375,000,000. The linking of Lakes and Gulf by the Lake 
Superior-Mississippi Canal involves the comparatively light investment of 
$8,000,000. Were there no other considerations and benefits to accrue, the 
opening of a north and south channel of commerce through the center of the 
United States, bringing together in one system the commerce of the Great 
Lakes and the commerce of the Gulf and Pacific, alone justifies the small in¬ 
vestment necessary as shown by the estimates of three preliminary examina¬ 
tions and surveys by United States engineers. Germany, France, Austria- 
Hungary, or any other European industrial and commercial power would not 
hesitate to invest many times that sum to insure such a vital and important 
national development. 


BENEFITS TO COOPERATING RAILROADS. 

48. It is safe to say that every enterprise which develops industry and com¬ 
merce, which builds up farming settlements and cities, which makes unde¬ 
veloped natural resources contribute to commerce and the support of popula¬ 
tion, directly or indirectly benefits the railroad. If the railroad loses the han¬ 
dling of one shipment, it makes up by being supplied with two other ship¬ 
ments. If it loses the haul of a car of coal or stone because that load can be 
more economically hauled by water, it makes double profit by having the haul 
of an increased volume of higher class merchandise at higher rates and with 
greater speed of transit, and a larger margin of profit in handling. 

Then it is patent that the river and canal reach along their shores undevel¬ 
oped or poorly developed resources, industries, and towns which the railroad 
can not profitably or has not been able profitably to reach and develop. The 
river and canal can do this work far more conveniently and economically than 
the railroad. The business developed becomes revenue freight at some stage 
of its route for the railroad; and the town, industries, resources, and commerce 
developed add directly or indirectly in the final result to the earnings of rail 
transportation. 

Again, whatever works to the maximum efficiency and economy of industrial 
and commercial operation works in the end to the mutual and reciprocal benefit 
of all factors involved, and, as one of the chief factors in the general system 
of industrial and commercial organizations, the railroad is a joint beneficiary 
with all. 

For example, take the comparative rail and water terminal investment, fixed 
charge, and operating cost. Byers finds that the interest and depreciation on 
38 leading freight terminals in the United States produces an average fixed 
charge of 28 cents per ton on each ton of merchandise handled at those termi¬ 
nals. When the river and lake harbor can operate on a fixed charge of 1 to 
3 cents per ton for the classes of heavy freight which the barge fleet handles, 
is not the railroad, as well as the rest of humanity, better off to let the barge 
handle that freight, and for the railroad to handle other higher class freight 
in which the fixed charge for terminal handling would be a minor item? 

The railroads of Europe have found development and progress in the coopera¬ 
tive activity of waterway and railway. They obtain higher average rates in 
handling higher average classes of tonnage. Leading railway authority in this 
country has arrived at the same view. Therefore, in carrying forward this 
project to completion, the basis should be the benefits to be achieved through 
rail and water cooperatioin, rather than to count on rail and water friction 
and hostility, to the detriment of all concerned. 

CONCLUSION. 

A. The project is justified by the reduction it will effect in freight rates. 
The reduction of the rail rate of 6 mills and more per ton-mile to 1.5 or 2 milk 
per ton-mile on the tonnage available to the project reimburses the United 
States many times over for its investment. This transportation rate economy 
does not cease at the canal, lake, and river dock, but has its general effect on 
transportation rates generally through an extensive territory even remote from 
the waterways. 

B. The project is justified because of the effect which the addition of 250 
miles of transportation facilities will have in developing commerce and industry. 
Here, again, the benefits are not merely local, but extend through a great com¬ 
mercial and industrial area which is in many directions made a common bene¬ 
ficiary. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 155 


C. The project is justified by the tonnage of coal, flour, grain, general mer¬ 
chandise, and large volume of miscellaneous commodities which it will handle 
to the mutual benefit of the labor and capital employed in the industries and 
to the common good of both the local and distant consumer who receives the 
products at a reduced cost of living. 

D. The project is justified as a link in a channel of commerce between the 
Government Mississippi River project of improvement in which nearly $150,000,- 
000 of the Nation’s revenues are invested, and the Great Lakes project of navi¬ 
gation in which it is estimated that for improvement and operation and main¬ 
tenance to date the nation has an aggregate investment of $100,000,000; this 
proposed $8,000,000 connecting link adding to the efficiency and carrying out the 
main purpose of both in creating a national system of waterway transportation 
and commerce. 

E. The project is justified as a necessary national link in a system of com¬ 
merce between Mississippi Valley and Atlantic, and again between Great Lakes, 
Gulf, and Pacific; and that, through the industrial heart of the Nation, where 
it can be of maximum service to the people and their industrial and commercial 
activities. 

F. The project is justified as the chief effective way by which the Lake 
Superior region and upper Mississippi Valley may realize their direct share in 
the Panama Canal improvement for development of commerce. 

G. The project is financially justified as a Government investment by the 
additional increment of Federal revenus it will produce. From Minnesota and 
Wisconsin the Federal Government will collect an aggregate of $20,000,000 to 
$25,000,000 annually as their proportional contribution of internal revenue, cus¬ 
toms tariff duties, income taxes, and miscellaneous revenues. Additional trans¬ 
portation facilities developing industries and commerce, increasing property 
values and earnings, and thereby increasing the income, purchase power, and 
consumption of the people, increases these Federal revenues. If this commer¬ 
cial and industrial enterprise through development of waterway transportation 
increases the Federal revenues from the States of Minnesota and Wisconsin only 
2 per cent per annum, it pays the annual $420,000 estimated by United States 
engineers for cost of operation, maintenance, and 3$ per cent interest on invest¬ 
ment. 

FUTURE GOVERNMENT AND STATE CANAL WILL BE AMPLY PROTECTED FROM RAILWAY 

BOYCOTTING AND RAILWAYS WILL BE COMPELLED TO EXCHANGE TRAFFIC WITH 

WATERWAYS ON FAIR TERMS. 

Current history clearly foreshadows the end of the monopolistic methods 
railway combinations have used in the past in crushing canal and waterway 
competition. Federal and State Governments will no longer tolerate such 
practices. 

In Panama Canal legislation Congress has indicated its policy by providing 
against railway ownership of vessels in competition with such railways. This 
was done because otherwise railway owned boats would monopolize coastwise 
traffic passing through the canal. The opening of the Panama Canal, where 
$375,000,000 of public money has been spent, creating as it will new currents of 
commerce affecting the trade of every section of the United States and the 
world, will keep the attention of the Nation focused upon waterway development 
and upon every attempt to strangle or destroy it. This interest will be intensi¬ 
fied by the completion and opening of the new Erie Canal in 1915, where the 
people of the State of New York not only have expended more than $100,000,000 
in the construction of the canal but, realizing that the old Erie Canal failed in 
part because the competing railways had purchased and gained control of the 
terminals, appropriated $19,000,000 for the purchase of adequate terminals and 
terminal facilities therefor. 

In addition to this a traffic department for the new Erie will be provided, the 
State will control the terminal charges and will control and require physical 
connections to be made between the canal and all of the railroads tributary 
thereto, facilitating exchange of freight between water and rail. The canal 
authorities and public service commission of the State will also control the 
making of joint rates for canal and rail traffic and the State is otherwise pre¬ 
pared to protect water traffic on the new Erie. It is estimated by Government 
engineers that the new Erie will carry 15,000,000 tons of freight annually. 

Is it conceivable that in the atmosphere created by the opening of these two 
great canal projects a canal project such as the one under consideration from 
Lake Superior to the Mississippi River can or will be controlled or dominated 


156 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


by railways? Is it possible under such conditions that the States of Minnesota 
and Wisconsin and the United States Government, warned as they now are by 
the examples of railway hostility, domination, and control of the canals and 
waterways of Europe and the United States in the past, will not take full and 
adequate measures to protect this canal and by such measures absolutely pre¬ 
vent the evils of railway boycotting and domination so fully reported upon by 
the authorities quoted herein? The States of Minnesota and Wisconsin will pro¬ 
vide adequate terminals with the most modern terminal facilities; they will 
require physical connection by all of the railways tributary to the canal; they 
will provide the necessary legislation for requiring the making of reasonable and 
fair joint through rates and for the equitable division thereof between canal 
and rail carriers so far as intrastate business is concerned, and there is no doubt 
but that Congress will provide the necessary legislation therefor so far as inter¬ 
state commerce is concerned. 

The public demand for relief from two great economic evils is ever increasing. 

First, the demand for lower rates of transportation. 

Second, the demand which amounts to a great economic necessity that the 
ever present menace of railway congestion and consequent enormous loss to 
countless thousands of people of the Nation be allayed by such a great increase 
in the facilities of transportation as can only be provided by canals and water¬ 
ways. 

Transportation authorities agree that in recent years the movement of traffic 
had increased entirely out of proportion to the increase in transportation facili¬ 
ties. During the period of 1900 to 1910 railway mileage increased 35.9 per cent, 
while the increase in freight ton mileage was 80 per cent. It is said by the 
National Waterways Commission that with the next period of expansion there 
is a strong probability of worse congestion of traffic than ever occurred before. 
Congestion of traffic acts upon commercial life exactly as a financial panic, only 
the loss, damage and wreckage are perhaps greater, more material and more 
lasting in their effects. The Nation has sought and we hope found relief from 
currency panics in the reserve bank system. It now seeks relief from com¬ 
mercial congestion, stagnation and consequent enormous losses in provisions 
for additional transportation by means of waterway improvements and canal 
extensions. The building of this important canal project is therefore of the 
utmost importance. 

If this project is not commercially feasible because of the conditions found 
to exist by the local board with reference to railway control and domination of 
water traffic, resulting in failure of waterways to obtain and hold their fair share 
of freight and which will, in the opinion of the local board, prevent this canal 
from obtaining traffic, then it logically follows that no further appropriations 
should be made by Congress for the improvement of any inland canal or water¬ 
way. All reports and findings of commissions, committees of Congress and ob¬ 
servations of students of transportation are to the effect that the same condi¬ 
tions as to railway control, etc., found by the local board to exist, are also 
found to exist and operate with reference to every canal and waterway of the 
Nation. What is the logic that justifies the improvement of the Mississippi 
River, the Missouri River, the canals connecting New Orleans with the Alabama 
coal fields, the Ohio River, when history shows that each of these waterways 
is in the same condition with reference to railway competition and domination 
as stated by the local board to exist with reference to the projected canal? 

It is the experience of the nations of continental Europe that unless re¬ 
strained by government railways could and would destroy water traffic. They 
did so until the governments concerned protected waterways from the unfair 
competition of railways. What has been done to protect waterways in those 
countries can and will be done in the United States. But there is no middle 
ground. Either we must confess that our policy of waterway improvements is 
a failure because of railway superiority or unfair competition and abandon the 
entire field of transportation to the railways and cease making appropriations 
for waterway improvements, or we must continue to improve our waterways, 
trusting to Congress and the States concerned to enact the necessary legislation 
to protect the public investments in such waterways. 

Finally, we desire to add that the report of the local board should not be 
concurred in, but the same should be modified or set aside and the project 
recommended as commercially feasible. That if the general board shall deem 
it advisable to recommend the proposed canal upon condition that the locali¬ 
ties and States interested provide proper terminals and terminal facilities 
open to all upon equal terms, subject to public control and free from railway 
or other monopolistic control so as to insure such fair treatment of canal 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 157 


commerce as may be within the power of the States and localities interested, 
such conditions will be cheerfully accepted and complied with. 

In consideration of this project, if the general board should find there are any 
other conditions subject to which the project can be recommended, such condi¬ 
tions will be accepted and performed by the States or localities interested, if 
possible. 

Respectfully submitted. 


Lake Superior and Mississippi River 
Canal Commission of Minnesota. 
George H. Sullivan, 

Stillwater, Minn., Counsel for Minnesota Commission. 

By A. O. Eberhart, 

Governor and Ex Officio Chairman. 
Ira B. Mills, Secretary. 

Lake Superior and Mississippi River 
Canal Commission of Wisconsin. 

E. F. Ackley, 

Chippewa Falls, Wis., Counsel for Wisconsin Commission. 
John Chinnock, Chairman. 

E. F. Ackley, Secretary. 

F. N. Stacy, Statistician. 


Exhibit I. 


Minnesota counties tributary to canal and river. 



Population. 

Valuation of farms. 

1910 

1900 

1910 

1900 

Carlton. 

17,559 
13,537 
25,171 
31,637 
333,480 
14,297 
15,878 
223,675 
18,554 
26,013 
33,398 
163,274 

10,017 
13,248 
21,733 
31,137 
228,340 
15,400 
11,546 
170,554 
18,924 
27,808 
35,686 
82,932 

$3,759,913 
12,289,044 
22,986,004 
32,266,663 
34,967,221 
16,836,250 
7,453,287 
9,726,904 
19,702,340 
16,334,539 
22,718,884 
6,798,209 

$939,664 
5,905,326 
11,793,346 
18,044,617 
19,909,980 
9,944,080 
2,273,424 
5,621,973 
12,080,170 
9,062,150 
14,371,809 
1,152,486 

Chisago. 

Dakota. 

Goodhue. 

Hennepin. 

Houston. 

Pine. 

Ramsey. 

Wabasha. 

Washington. 

Winona.. 

St. Louis. 

Total. 

916,473 

667,325 

205,839,258 

111,099,025 



Wisconsin counties tributary to canal and Mississippi River. 


Valuation of farms. 


Population, 

1910. 


1910 


1900 


Barron. 

Bayfield. 

Buffalo. 

Burnett. 

Crawford 

Douglas. 

Dunn. 

Grant. 

La Crosse... 

Pepin. 

Pierce. 

Polk. 

St. Croix_ 

Trempealeau 

Vernon. 

Washburn.. 


29,114 
15,987 
16,006 
9,026 
16,288 
47,422 
25,260 
39,007 
43,996 
7,577 
22,079 
21,367 
25,910 
22,963 
28,116' 
8,196 


$18,976,694 
3,209,775 
16,581,677 
4,914,983 
12,338,063 
2,795,283 
20,913,419 
42,426,158 
13,790,945 
5,971,873 
18,997,948 
16,606,522 
23,998,981 
21,411,077 
25,289,099 
3,570,620 


$6,374,063 
615,578 
9,892,567 
1,670,203 
6,808,630 
722,199 
8,748,003 
26,305,272 
9,298,824 
3,254,996 
10,733,194 
6,458,007 
12,022,751 
11,923,019 
13,556,799 
702,311 


378,314 


251,793,117 


129,086,416 


Total 



















































158 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

Farm crop statistics and values. 


Carlton. 

Chisago. 

Dakota. 

Goodhue. 

Hennepin.... 

Houston. 

Pine. 

Ramsey. 

Wabasha. 

Washington.. 

Winona.. 

St. Louis. 

Total.. 

Barron.. 

Bayfield__ 

Buffalo.. 

Burnett. 

Crawford_ 

Douglas. 

Dunn. 

Grant. 

La Crosse 

Pepin. 

Pierce. 

Polk. 

St. Croix_ 

Trempealeau 

Vernon. 

Washburn.. 

Total.. 


Number 
of farms, 
1910. 

Farm-acres 

cultivated. 

Crop value. 

Live-stock 

value. 

1,195 

120,505 

$430,866 

$422,503 

2,005 

225,773 

1,544,517 

1,344,671 

2; 163 

329,801 

3,177,701 

2,316,378 

3,090 

462,052 

3,997,787 

3,507, .509 

3,853 

284,378 

4,132,598 

2,809,233 

1,912 

327,094 

1,979,513 

2,178,443 

2,066 

230,689 

846,136 

904,663 

1,067 

60,543 

' 1,072,780 

711,008 

1,787 

320,984 

2,736,692 

2,170,305 

1,943 

226,312 

2,129,792 

1,669,805 

2,141 

374,234 

2,712,087 

2,638,487 

2,465 

272,995 

919,360 

726,394 

25,687 

3,235,360 

25,679,829 

21,399,399 

3,852 


2,156,442 

2,229,092 

1,086 


343,579 

351,244 

2,161 


2,203,637 

2,479,855 

1,676 


552,902 

612,807 

1,983 


1,797,644 

1,896,759 

853 


255,583 

267,042 

3,297 


2,580,851 

2,565,337 

4,056 


4,702,792 

5,694,621 

1,811 


1,694,725 

1,867,574 

1,038 


796,771 

755,252 

3,213 


2,802,150 

2,327,125 

3,399 


1,925,250 

2,143,337 

3,119 


3,286,125 

2,864, .850 

3,008 


2,747,785 

2,885,615 

4,003 


3,197,871 

3,193,191 

972 


401,184 

405,508 

39,527 


31,445,291 

32,539,209 


Carlton. 

Chisago. 

Dakota. 

Goodhue.... 
Hennepin... 

Houston. 

Pine. 

Ramsey. 

Wabasha.... 

Washington. 

Winona. 

St. Louis.... 

Total.. 

Barron. 

Bayfield. 

Buffalo. 

Burnett. 

Crawford.... 

Douglas. 

Dunn. 

Grant. 

La Crosse.... 

Pepin. 

Pierce. 

Polk. 

St. Croix_ 

Trempealeau 

Vernon. 

Washburn... 


Grain. 

Hay. 

Potatoes. 

Fruit. 

Dairy 

cows. 

Bushels. 

Tons. 

Bushels. 

Bushels. 


56,891 

20,215 

239,715 

231 

4,033 

1,116,799 

63,920 

1,874,597 

4,957 

14,405 

4,374,599 

67,233 

629,503 

26,486 

12,204 

5,462,783 

117,488 

165,728 

48,020 

24,111 

2,321,310 

124,811 

2,438,132 

58,734 

22,379 

2,708,198 

67,052 

172,090 

33,713 

14,381 

365,316 

48,046 

468,834 

1,741 

9,788 

405,039 

29,828 

497,939 

3,364 

5,632 

3,968,412 

60,240 

198,128 

41,511 

11,106 

2,533,926 

62,250 

758,162 

15,162 

10,637 

3,786,077 

75,319 

30S,444 

39,443 

16,450 

44,214 

28,247 

355,537 

137 

6,234 

27,143,564 

764,649 

8,106,809 

273,499 

151,360 

1,553,990 

102,025 

1,194,012 

8,435 

23,081 

59,769 

13,827 

159,710 

2,451 

2,385 

3,009,703 

75,059 

177,849 

25,47»8 

21,627 

375,877 

32,113 

287,735 

654 

7,634 

1,503,992 

62,699 

137,894 

47,030 

16,681 

41,506 

11,028 

111,103 

359 

2,085 

3,104,140 

86,168 

689,975 

17,129 

24,001 

6,090,204 

140,497 

368,825 

51,708 

36,520 

1,980,076 

60,423 

242,130 

32,455 

19,984 

1,067,479 

21,482 

66,610 

11,130 

6,350 

3,975,946 

74,378 

282,223 

35,995 

17,912 

2,047,748 

93,561 

468,361 

4,210 

22,473 

4,731,807 

103,271 

375,615 

5,193 

23,804 

3,453,979 

103,095 

159,672 

30,382 

25,049 

2,587,993 

116,389 

319,026 

73,412 

30,187 

211,342 

17,658 

201,534 

731 

3,401 

35,795,551 

1,113,673 

5,242,274 

346,752 

283,174 


Total 







































































































WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 159 


Southern Minnesota counties tributary to canal. 



Grain crop. 

Potato crop. 

Blue Earth. 

5,803,374 

4,599,816 

2,479,852 

2,291,293 

5,274,642 

5,665,286 

3,942,389 

3,076,483 

6,284,407 

5,002,794 

3,252,347 

213,787 
126,438 
145,356 
79,181 
140,483 
172,405 
196,865 
117,476 
175,074 
231,528 
97,739 

Brown. 

Carver. 

Dodge. 

Faribault. 

Fillmorfe. 

Freeborn. 

Le Sueur. 

Martin. 

Mower. 

Nicollet. 



Olmsted... 

Rice. 

Scott. 

Sibley. 

Steele. 

Waseca.... 

Watonwan 


Grain crop. 

Potato crop. 

4,219,103 

164,919 

3,647,307 

150,742 

2,230,773 

105; 268 

4,287,299 

135,022 

2,594,220 

138,390 

2,770,886 

107,100 

3,564,741 

69,430 

70,987,012 

2,567,203 


Exhibit II. 


Elements of locks and dams, Monongahela River. 


Lock numbers. 


Characteristics. 

i 

2 

3 

4 

Old. 

New. 

Distance from mouth, miles. 

195. 

11.20. 

25.0. 

23.8. 

41.24. 

When built: 






First lock. 

1841. 

1841. 

1844. 

|1906-7. 

/1844. 

Second lock. 

1848. 

1853-4. 

1883. 

\1886. 

When rebuilt. 


1904-5. 





/50 by 158.... 

56 by 360.... 

50 by 158.... 

56 by 360.... 

50 by 158. 


\56 by 216.... 

56 by 360.... 

56 by 277.... 

56 by 360.... 

56 by 277. 

Lift at low water. 

4.4 1 . 

7.8. 

7.44. 

8.4. 

11.5. 

Depth on lower sill, feet. 

9.3. 

8.68. 

.. 

8.42. 

5.87. 

Guard. 

10.3. 

12.3. 

10.0. 

12.1. 

8.8. 

Elevation, upper sill.. 

/696.7. 

|706.6 J . 

716.3. 

715.25. 

/719.78. 


\695.2. 




\726.18. 

Elevation, lower sill. 

/695.6. 

|698.7 *. 

709.46. 

707.08 . 

/718.38. 


\693.7. 




\718.03. 

Founded on . 

Rock . 

Piles in 

Gravel . 

Rock. 

Gravel. 

Walls, height above floor . 

123.3 . 

gravel. 

/23.8. 

J.31.5. 

/25. 4. 

124.2. 

|29.77. 

\24.1. 

\25. 8. 

Walls, base width. 

12.0. 

/River wall.. 

VIA A 4 

12.0. 

1 A A 

)l6, 20, 22.... 

/12. 0. 
ik n 

TTpp«r guide wall, length 

300 . 

^lO. f 1 . 

105 . 

14.U......... 

789 . 

) 

360 . 

^10.1/. 

890. 

Lower guide wall, length 

320 .. 

300 . 

275 . 

360 . 

310. 

JTpper guard wall length 

195 . 

150 . 

225 . 

150 . 

166. 

Lower guard wall, length 

None . 

None . 

None . 

None . 

None. 

T>?mv Length, feet. 

962.5 . 

808 . 

689 . 

684.36 . 

703. 

Material . 

Timber, 

Concrete on 

Timber, 

Concrete on 

Timber, 


stone filled. 

piles. 

stone filled. 

piles. 

stone filled. 

Elevation of orest. and pool 

707.4 . 

715.25. 

723.1. 

723.9. 

734.98. 

Founded on... 

Gravel. 

Piles in 

Gravel. 

Piles in 

Gravel. 



gravel. 


gravel and 


Fall-over at epoch of submerg- 

0 to 4 feet 

co 

o 

1.9 . 


2.7. 

ence of lock walls. 







9 25 

12.6 . 

16.24 . 

17.44 . 

17.68. 

A butnient. — Type .. . 

Crib . 

Concrete, 

Crib, verti- 

C one rete, 

Concrete, 



v e r t i c al 

cal face. 

v e r t i c al 

sloped. 



face. 


face. 


Fnnndftd on _ __ 

Gravel . 

Piles in 

Gravel . 

Piles in 

Gravel. 



gravel. 


gravel and 






sand. 



» About pool full Davis Island Dam. 

* Upper guard sill, 707.1. 

* Lower guard sill, 699.25. 


* Middle wall, 20 feet. 

• Dependent on stage of Allegheny River, 







































































































































1G0 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 
Elements of locks and dams, Monongahela River —Continued. 


Lock numbers. 


Characteristics. 

5 

6 

7 

8 

9 

Distance from mouth, miles.../. 

58.9. 

68.67. 

82.74. 

87.55. 

93.3. 

When built. 

1856. 

1856. 

1883. 

1882-9. 

1874-9. 

Lock, size, feet. 

50 by 165.5.. 

50 by 165.4... 

50 by 159.... 

50 by 161.6... 

50 by 160. 

Lift at low water. 

10.93. 

13.3. 

9.2. 

10.6. 

12.33. 

Depth on lower sill, feet. 

5.2. 

5.5. 

6.61. 

5.2. 

5.5. 

Guard. 

10.5. 

9.6. 

9.2. 

10.2. 

7.6. 

Elevation, upper sill. 

741.31. 

753.57. 

763.84. 

775.0. 

767.0. 

Elevation, lower sill. 

730.28. 

741.36. 

754.19. 

765.0. 

775.55. 

Founded on. 

Gravel. 

Rock. 

Rock. 

Rock. 

Rock. 

Walls, height above floor. 

26.6. 

29.4. 

26.0. 

36.0. 

27.5. 

Walls, base width. 

14.0. 

14.0. 

14.5. 

18.0. 

11.6. 

Upper guide wall, length. 

None. 

N one.. .. 

34. 

190. 

130. 

Lower guide wall, length. 

118. 

120. 

85. 

107. 

173. 

Upper guard wall, length. 

108. 

130. 

238. 

107. 

65. 

Lower guard wall, length. 

None. 

None. 

None. 

None. 

None. 

Dam—Length, feet_1. 

620 . 

626. 

525.5. 

600. 

410. 

Material........ 

Timber, 
stone filled. 
746.41. 

Timber, 

Ti m b e r, 

Timber, 
stone filled. 
780.8. 

Masonry. 

Elevation of crest and pool. 

stone filled. 
760.15. 

stone fdled. 
770.0. 

793.4. 

Founded on. 

Gravel. 

Gravel. 

Gravel. 

Gravel. 

Rock. 

Fall-over at epoch of submerg- 

3.2. 

5.7. 

4.8. 

5.5. 

9.6. 

ence of lock walls. 

Length of pool, miles. 

9.75. 

14.07. 

4.81. 

5.75. 

9.3. 

Abutment—Type. 

Crib, verti- 

Crib, verti¬ 
cal face. 
Gravel. 

M a s o nry, 

Masonry.... 

Masonry, 

Founded on. 

tical face. 
Gravel. 

sloped. 
Hara pan... 

Rock. 

sloped. 

Rock. 






Characteristics. 



Lock numbers. 




10 

11 

12 

13 

14 

15 

Distance from mouth, miles... 

102.6. 

104.95. 

109.85 . 

111.80. 

115.50. 

124.10. 

When built... 

1897-1903.. 

1901-1903.. 

1901-1903.. 

1901-1903.. 

1901-1903.. 

1901-1903. 

Lock, size, feet. 

56 by 182.. 

56 by 182.. 

56 by 182.. 

56 by 182.. 

56 by 182.. 

56 by 182. 

Lift at low water. 

10.67. 

10.67. 

10.67. 

10.67_ 

10.67 

10.67. 

7.0. 

Depth on lower sill, feet. 

7.0. 

7.0. 

7.0. 

7.0. 

7.0. 

Guard. 

8.5. 

7.7.; 

8.0. 

8.0. 

8.0. 

8.0. 

Elevation,upper sill. 

790.58. 

807.25. 

817.92. 

828.59_ 

839.25.. 

849.92. 

Elevation^ lower sill. 

786.92. 

797.59. 

808.25. 

818.92_ 

829.58 

840.25. 

Rock. 

27.0. 

14 and 15. 

99.7. 

117. 

91. 

33. 

420. 

Concrete. 

Founded on. 

Rock. 

Rock. 

Rock. 

Rock. . 

Rock 

Walls, height above floor. 

27.5. 

26.5. 

27.0. 

27.0. 

27.0 

Walls^ base width. 

16.0. 

14 and 15.. 

14 and 15.. 

14 and 15 . 

14 and 15.. 
100 

Upper guide wall, length. 

180.2. 

100.3. 

100. 

None... . 

Lower guide wall, length. 

155.6. 

152. 

52.3. 

151.7. 

152 

Upper guard wall, length. 

53.3. 

91.2. 

66. 

91. 

90. 

Lower guard wall, length. 

52.5. 

None. 

None. 

None. .. . 

None 

Dam—Length, feet... T. 

445. 

500. 

447. 

425 . ... 

433 

Material.. T.... 

Concrete.. 

Concrete.. 

Concrete.. 

Concrete.. 

Concrete.. 

Elevation of crest and pool.... 
Founded on. 

804.66. 

815.33. 

826. 

836.67. 

847.33... 

838.0. 

Rock. • 

7.1. 

Rock. 

Rock. 

Rock. 

Rock.. 

Rock 

Fall-over at epoch of submerg- 

7.0. 

8.9. 

8.4. 

9.3. 

8.5. 

ence of lock walls. 

Length of pool, miles. 

2.35. 

4.9. 

1.95. 

3.7. 

8.6. 


Abutment—Type. 

Concrete, 

Concrete, 

T i m b er. 
vertic al 

Concrete, 

Concrete, 

Mas onry. 

sloped. 

sloped. 

sloped. 

sloped. 

verti c a 1 

Founded on. 

Rock. 

Rock. 

face. 

Rock. 

Rock.. .. 

Rootc 

face. 

Rock. 













































































































































































































WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


101 


Exhibit III. 


War Department, 

United States Engineer Office, 
Pittsburgh, Pa., November 7, 1913. 

Mr. P. N. Stacy, 

Holland House, New York, N. Y. 

Dear Sir: In reply to your letter of the ,4th instant to Col. Newcomer, my 
predecessor in charge of this office, I transmit herewith a letter statement pre¬ 
pared by Asst. Engineer T. P. Roberts, of this office, which answers your various 
questions in regard to commerce of rivers in the Pittsburgh, Pa., engineer 
district. 

By direction and in the absence of Lieut. Col. Francis It. Shunk, Corps of 
Engineers: 

Very respectfully, 


H. J. Rossiter, Chief Clerk. 


War Department, 

United States Engineer Office, 
Pittsburgh, Pa., November 7, 1913. 

From : Thomas P. Roberts, assistant engineer. 

To: The District Engineer Officer, Pittsburgh, Pa. 

Subject: Answers to questions proposed by the Lake Superior and Mississippi 

River Canal Commission. 

1. “Aggregate cargo tonnage per annum (approximate) on rivers and canals 
of your district.’’ 

For several years past the total cargo tonnage of the Pittsburgh district has 
not varied much from 12,000,000 tons per annum. Of this total about 9,000,000 
tons is coal from the Monongahela River, of which from 2,000,000 to 3,000,000 
tons are shipped down the Ohio to Cincinnati and points farther west and south. 
Of the residue of this coal about 1,000,000 tons (rough estimate) are shipped by 
rail to Conneaut Harbor on Lake Erie, and from 5,000,000 to 6,000,000 are 
locally consumed. Of the local consumption about one-half is made into coke by 
the Jones & Laughlin Co., mostly within the limits of this city. This firm is 
rapidly enlarging its river business in coking coal to meet the demands of its 
extensive new plant on the Ohio about 18 miles below Pittsburgh. This one 
firm’s business will in the near future increase its river coal demand from its 
present 3,000,(X)0 tons to about 5,000,000 per annum. 

2. “Average draft and cargo tonnage of coal carrying boats and barges on the 
Monongahela and through your canals.” 

Until within the last few years all the boats, barges, and flats used in the 
Monongahela were of wood. These vessels are not registered, and their number 
in use at present is unknown. Inquiries made in 1904 developed the fact that at 
that time there were between 1,000 and 1,100 vessels employed in the local trade 
of Pittsburgh, ranging from 200 to 400 tons. This did not include the coal 
flats used by Jones & Laughlin, about 500 in number, of average capacity of 
about 500 tons. 

The boats and barges in the Ohio River traffic were estimated to number 
somewhat more than 2,500, ranging from 500 to 1,200 tons capacity each. The 
great number of boats heretofore used in the Ohio traffic is explained by the 
fact that owing to the uncertainties of the navigation of the river and time lost 
in trips to Memphis, New Orleans, etc., many of them were not loaded more 
than twice during a year. The upper Ohio was navigable for coal boats upon 
an average of only 89 days per annum, and these days very unequally distrib¬ 
uted, six months sometimes passing without sufficient depth. With the dams 
so far completed on the Ohio, the average number of days per annum on the 
river from Pittsburgh for the coal trade has been increased to 116. 

Already there appears to be a transformation in the Ohio River traffic. The 
American Steel & Wire Co. has in operation a line between Pittsburgh and 
Louisville of 10 covered steel boats 200 by 36 by 9 feet loaded depth, of 1,500 
tons cargo capacity, for wire nails, horseshoes, cotton ties, etc. Jones & Laugh- 


H. Doc. 1008, 64—1-11 




162 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


lin, for their Ohio River coal traffic, from the mines to Alquippa, 18 miles below 
Pittsburgh, have in operation twenty-four 200 by 26 feet steel boats, 71 to 8£ 
feet draft, capacity 1,000 to 1,100 tons. 

The Crucible Steel Co., of Pittsburgh, has 22 steel barges 100 by 26 feet, r i\ 
feet draft. Other parties are also building steel boats. All of these steel 
boats ply the lower pools of the Monongahela River, and some of them also ply 
upon the lower Allegheny River in the local business between mills. There are 
besides several hundred sand and gravel flats plying the three rivers about 
Pittsburgh. 

The usual size of a coal tow on the Monongahela River for the lower Ohio 
and Mississippi traffic is three boats of 1,000 tons each, 175 by 26 feet, 8 feet 
draft, with towboat, able to pass through the locks unbroken. The available 
size of each of the double locks, Dams 1 to 6, is 360 by 56 feet; minimum depth 
on sills, 8 feet. Nearly the same quantity of coal in more numerous barges of 
500 tons capacity each is also passed. From 7 to 10 of the small flats with their 
steamer are able to be passed through the locks in one operation. 

From the above it will appear that the locks on the Monongahela do a very 
miscellaneous business. The actual “ average capacity ” of the boats has never 
been given in the annual reports, although it could be calculated, if desired, 
from the monthly reports from the various locks. 

3. “ Per ton cost of water transportation of coal in your district, stating 
approximate average ton-mile rate, and giving, if data handy, a few cases of 
economical transportation.” 

Several years ago the Jones & Laughlin Steel Co. reported officially that the 
actual cost to them of moving coal from their mines to their mills and coke 
ovens in Pittsburgh, then doing a business of 2,000,000 tons per annum, was 4.2 
cents per ton. The round-trip distance was 104 miles, including the passage of 
three locks in each direction. The estimate included the return of the empty 
boats to the mines. The final result was a ton-mile rate of 0.08 cent. To this 
was added, in this office, interest account on capital invested at 5 per cent 
and 15 per cent for depreciation of floating plant, which brought the ton-mile 
rate up to 0.18 cent or (1.8 mills). 

With the larger locks which have been recently constructed or in progress 
enabling larger fleets of greater draft to pass unbroken down the Monongahela, 
there will be a considerable reduction in the above ton-mile rate. 

It is to be remarked that other firms doing a less regular business find the 
cost considerably more than that reported by the Jones & Laughlin Co. Some 
of them have estimated their cost at double the Jones & Laughlin figures for the 
same distance and number of lockings. 

The actual running time and cost of steamers and fleets, if it could be differ¬ 
entiated, will not, however, vary much from the Jones & Laughlin carefully 
estimated figures. 

Very much could be said of the cost of transportation of coal on the Ohio 
and Mississippi Rivers. The actual cost of round-trip running expenses under 
favorable conditions on the Mississippi River between Pittsburgh and New 
Orleans, including return of empty boats, has been given at from 60 to 75 
cents per ton, distance about 2,000 miles one way. This refers to a fleet carry¬ 
ing, say, 20,000 tons, Pittsburgh to Louisville, 600 miles, and thence with a 
larger towboat, taking two of the upper-river fleets, or, say, 40,000 tons, Louis¬ 
ville to New Orleans, 1,360 miles. 

For an annual business of 3,500 tons of coal, systematized, oil the river, 
Pittsburgh to Louisville, when 9 feet depth will be available for nearly the 
entire year, it has been estimated that the cost per ton, including return of 
empty boats to the mines, will be 24.1 cents, interest and depreciation of plant 
also included, which would make four-tenths of a mill per ton-mile. The fig¬ 
ures in no case include a profit. The figures if made now and taking into 
account the increased cost of steel boats over wooden ones heretofore engaged 
in the traffic, would be considerably increased in the item of first cost and in¬ 
terest minus a considerable reduction in depreciation, with the result of some 
final increase. It was estimated that on the improved river the existing busi¬ 
ness could be done with one-third of the capital investment, with fleets not 
larger in area than the area of Ohio River locks, viz, 600 by 110 feet. 

4. “ Per ton cost of unloading coal from boats and barges to dock with mod¬ 
ern machinery and methods.” 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 163 


M e have on the Monongahela, in pool No. 1, a double ladder coal dredge un¬ 
loading 500 tons per hour, raising it about 70 feet, and transferring the coal 
by an endless belt several hundred yards to the cars which distribute the coal 
to ihe coke ovens for a cost of one-quarter of a cent per ton. This is only 
about one-twelfth the cost of simply raising the coal with a clamshell to the 
height of 70 feet. 

5. “Amount per ton damage to coal from such handling.” 

On this point there appears about Pittsburgh to be very little demand in 
recent years for lump coal. The proportion of “ run of mine,” or nonscreened 
coal has greatly increased as shipped both by rail and boat. It is, therefore, 
the case that the handling of the coal, provided it results in no loss of weight, 
results in no financial damage. For steam making also of late years coal slack 
with much dust in it, carrying often much sulphur, as compared with screened 
coal, is much used on account of its low price. Natural gas is used for domes¬ 
tic fires to a very great extent over most of the district. 

6. “ How does coal carrying by water compare with rail transportation in 
regard to economy of transportation and handling?” 

As for local rail rates they are very high as compared with river rates in the 
Monongahela Valley, nevertheless in this city, owing very largely to its 
topography, much the greater part of the local demand is met by the railroads. 
If, however, the demand at a particular point on the river is very large, as is 
the case of the Jones & Laughlin Co., it would, with proper unloading machinery, 
be possible to save 25 cents per ton in Pittsburgh, as that firm does over the 
published rail rates. Coal from mines along the river at 40 to 60 miles distance 
is charged 3S cents a ton for transportation by rail, included in which is the 
usual “terminal charge” equal, it is understood, to 25 miles rail haul. The 
wagon haul from boats for domestic coal operates against the widespread 
distribution of river coal in this city. 

As a matter of fact but little attempt is made by the railroads in the Mo¬ 
nongahela Valley above Pittsburgh to compete in the local markets with boats 
for the home trade. Local mines often serve the trade. The railroads seem to 
he more concerned in the integrity of their main line tracks in the interest of 
their enormous through coal trade destined for the lake region than for local 
interests. Switches to small establishments are not favored, and cross-over 
tracks are placed with rare exceptions only to serve the needs of the railroads. 

The railroads naturally have the advantage over coal in boats so far as 
unloading is concerned, excepting where special machinery is employed, such 
as has been referred to elsewhere. 

Thos. P. Roberts, Assistant Engineer. 


Exhibit IV. 


Mr. F. N. Stacy, 

Holland House, New York, N. Y. 

Dear Sir: In reply to your letter of the 9th instant, I inclose herewith 
answers prepared by Mr. T. P. Roberts, assistant engineer, to your various 
questions concerning commerce, etc., on the Monongahela River. 

For and in the absence of Lieut. Col. Francis R. Sliunk, Corps of Engineers: 
Very respectfully, 

H. J. Rossiter, Chief Clerk. 


War Department, 

United States Engineer Office, 
Pittsburgh, Pa., November 13, 1913. 

From: Thomas P. Roberts, assistant engineer. 

To • The District Engineer Officer, Pittsburgh, Pa. 

Subject: Answers to questions of Lake Superior and Mississippi River Com¬ 
mission, dated November 9, 1913. 

1. “Data of traffic and vessels passing one of your principal Monongahela 
River locks for some month of comparatively large traffic this season,” etc. 




164 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


The locks at Dam No. 3, 22 miles above Pittsburgh, are selected. The up and 
down river business from January to October by months during the present year 
has been as follows: 


• 

Steamers. 

Coal boats, 
barges, and 
boat bottoms. 

Coal traffic (tons). 

Total traffic 
(tons). 


Up. 

Down. 

Up. 

Down. 

Up. 

Down. 

Up. 

Down. 

1913. 

January. 

454 

451 

2,019 

2,074 

160 

919,800 

6,196 

943,230 

February. 

485 

478 

2,080 

2,106 

0 

983,680 

3,115 

1,000,930 

March. 

517 

524 

2,086 

2,162 

0 

1,042,480 

9,090 

1,064,170 

April. 

496 

486 

2,051 

2,033 

160 

897,320 

11,607 

920,301 

May. 

325 

329 

1,848 

1,768 

260 

837,160 

7,538 

847,796 

June. 

338 

341 

1,782 

1,831 

0 

830,000 

8,738 

838,086 

July. 

357 

351 

1,647 

1,697 

160 

783,640 

8,095 

789,554 

916,837 

August. 

401 

400 

1,989 

1,967 

80 

910,600 

5,960 

September. 

344 

339 

2,008 

1,959 

0 

886,800 

6,483 

888,044 


The daily records kept at the locks have to be consulted to differentiate the 
coal boats from the coal barges, and boat bottoms. It will require two or three 
days’ time to obtain the desired information from the log book kept at Lock 3. 
The information will be mailed to any address as requested. By “ boat bottoms ” 
is meant new coal boat bottoms shipped down the Allegheny and sent up to 
the mines on the Monongahela, to be sided up with plank gunwales 10 
feet high, making boats 180 by 26 by 10 feet high of 1,000 to 1,100 tons capacity, 
at say feet draft. 

2. “ Copies of printed reports of district engineer,” etc. 

Annual reports for fiscal years 1910 and 1912, of which spare copies have 
been found, are inclosed herewith. While the reports in general are for fiscal 
year, commercial statistics are given for calendar years 1909 and 1911. Also 
there is inclosed lock gauge records of sill depths, Locks 1 to 6, inclusive, for 
the year 1912. The lower gauges at locks are to be referred to as giving the 
navigable depth for boats, notwithstanding that when the adjustable tops on 
the dams are raised there may be a greater depth on the upper than on the 
lower lock sill. 

Regarding (a) navigable depths on upper Monongahela lock sills, will say 
that normal minimum depth at new Locks 10, 11, 12, 13, 14, and 15, is 7 
feet. High floods reach depths of 35 feet. Navigation is practicable until the 
lock walls are flooded, say 20 feet, on lower gauge. Locks 6, 7, 8, and 9 have 
been recommended for improvement and enlargement. At present in that part 
of the river during prolonged droughts the navigable depth is no more than 5 
feet, a stage lasting on rare occasions for a month or more. 

At present there is only one firm shipping coal from above No. 6 dam. The 
company’s business amounts to about 25,000 tons annually (from its own mines, 
in its own flat boats, to its own manufacturing establishment in McKeesport, 
Pool No. 2, a distance of about 85 miles below the mines). The mines are 
in the 14th pool. During seasons of severe drought the depth available at Locks 
7. 8, and 9 has been as low as 5 feet, permitting the safe passage of flats loaded 
to only about 4.5 to 4.75 feet, with flats carrying about 200 tons each. How¬ 
ever, with, say, five such flats a thousand tons could be moved in one fleet. Just 
what profits were at such times I have no information, but as the saving was 
fully $250 for each thousand tons over rail rates, I scarcely think the expense 
of the small boat, small crew, and other operating expenses could have been 
so much. Thirty dollars per diem would have been, I think, a proper allow¬ 
ance for this particular case, and not over five days to make a round trip. 
(The company’s demands did not require the constant service of its towboat to 
obtain its coal supply. At least more frequent trips could have been made.) 

It is to be noted that it is to area rather than depth that credit is due for the 
wonderfully low rates of transportation possible on our western rivers, espe¬ 
cially on the Ohio. But no other possible kind of steamer could handle fleets 
in the Ohio, with its varying conditions of depth and current velocities, but 
stern-wheel boats, equipped with several balanced rudders which insure enor¬ 
mous steering power when the wheel is backed against the rudders. About 
busy locks, as on the Monongahela, side wheel or propeller boats with consider- 
























WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 1G5 


able tows, no matter what their ultimate power may be, would cause delays, 
confusion, and accidents. Steamers which can not quickly check the speed of 
their fleets and turn their fleets without the steamer moving more than a few 
teet, or even with the steamer itself tied to a pile, would never do for the 
peculiar traffic of the Monongahela, which is persistent night and day, winter 
and summer, with serious accidents exceedingly rare about the locks. 

As to (b) “Approximate first cost of coal handling with a double ladder 
dredge of 500 tons capacity per hour.” 

The following information regarding unloaders has been received from the 
Jones & Laughlin Steel Co.: 

1. Capacity: 

Hazelwood (Monongahela River) GOO tons per hour (approximate). 

Aliquippa (Ohio River) 800 tons per hour (approximate). 

2. Cost: 

Hazelwood, approximately $30,000 to $40,000. 

Aliquippa, much more on account of bad foundation. 

3. Type: 

Buckets at both plants. 

Buckets measure 234 inches by 2G inches by 4 feet 104 inches long, and hold 
675 pounds each. 

I will add to the above that part of the mechanism is a tension cable beneath 
the elevator which keeps pulling the boat against the coal all the time, so that 
the buckets are always full. The barges have sloped sides to favor movement 
of the coal toward the buckets. Only one man is required to attend to the un¬ 
loading about the boat. 

As to (c) “ Comparison of the cost of delivery of Monongahela River coal 
by rail and by river to points in the pools above No. G. shows a saving of from 
30 to 50 cents a ton in favor of water transportation.” (Quoted from Report 
of Chief of Engineers for 1912, vol. 1, p. 905.) 

Reference is to Dam 6 on the Ohio, about 29 miles below Pittsburgh. The 
center of the active river mining district on the Monongahela is about 50 
miles above the city. The 50-cent saving is, therefore, for the 29 plus 50, or 
79-mile distance, and the 30 cents for the 50 miles, distance to Pittsburgh. 

In my previous letter I mentioned that some of the smaller manufacturers 
along the Ohio, above No. G, were contemplating the erection of hoists to un¬ 
load coal from boats; but, as is usually the case, there are from four to six 
more tracks between the factories and the river banks. The problem of the hoist 
is very difficult for some of them. This trouble explains why river coal is not 
more generally used along the extreme upper Ohio. To see coal passing one’s 
doors on the river so much cheaper than one must pay for it from another 
source must, of course, be “ trying.” 

I will add, in conclusion, that on the projected so-called “ ship canal,” Ohio 
River to Lake Erie, leaving the Ohio River 25 miles below Pittsburgh, thence 
via the Beaver and Mahoning Rivers to near Ashtabula, on Lake Erie, distance 
103 miles, 30 locks, the carefully estimated cost of moving coal from Pitts¬ 
burgh to and into vessels on Lake Erie, in boats of 11 feet draft, 2,000 tons 
capacity, was actually 20.1 cents per ton, or 1.44 mills per ton per mile, from 
Pittsburgh to Lake Erie, but with toll charges of 30 cents and other sources 
of profit added the final charge would be C0.2 cents per ton, or 4.30 mills per 
ton-mile, as against 5.53 mills per ton-mile by the Bessemer & Lake Erie Rail¬ 
road, or over 8 mills per ton-mile charged by other railroads from Pittsburgh 

to Lake Erie. J x . 

Thos. P. Roberts, Assistant Engineer . 


ADDENDA. 


The average cargoes of various types of vessels passing Lock No. 3, 
Monongahela River, during March, 1913, is shown in the following statement: 


Downward: 

106 boats, carrying 166,000_tons- 

1,422 barges, carrying 722,5G0 tons 
570 flats, carrying 152,000 tons_- 
1 model barge, carrying 1,400 tons 


Average tons 
per boat. 

_1,000 

_ 508 

_ 268 

_1,400 






1GG WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


A few small naphtha boats passed are not included in the above. Five 
hundred and fourteen steamers passed downward with the loaded vessels. The 
upward movement was practically the same, with the exception that all boats, 
barges, and fleets were empty. 

Several blue prints of coal hoists, including one of the double ladder dredges 
referred to in my previous letter, are inclosed. 1 

Thos. P. Roberts, Assistant Engineer. 


Exhibit V. 


Mr. F. N. Stacy, 

State Capitol Building, St. Paul, Minn. 

Dear Sir: Noting your favor of the 30th ultimo; tonnage of coal received 
in New York Harbor is about 40,000,000 per annum. In the absence of specific 
figures, it is impossible to tell exactly what the amount is, but it is under¬ 
stood to be about as mentioned, with something less than one-half retained for 
local use, the remainder shipped east and south. 

The tonnage for city docks is brought by barge from rail terminals, with the 
exception of a half dozen yards which handle car-ferry coal. Cost of unload¬ 
ing from boats is of itself a small matter when done by steam shovel, in this 
case probably amounting to 3 or 4 cents a ton, although in such a matter there 
will always be a question as to how much should be allowed for overhead 
expense, etc. 

Yours, truly, 


F. W. Saward, General Manager. 


Exhibit VI. 

October 9, 1913. 

Mr. F. W. Stacey, 

Statistician Lake Superior and Mississippi River 

Canal Commission, State Capitol Building, St. Paul, Minn. 

Dear Sir : Referring to your recent request for preliminary estimate on coal¬ 
handling equipment of various capacities and arrangement, we are pleased to 
submit the following preliminary estimate: 

For unloading coal from ore-carrying vessels of 5,000 to 12,000 tons of iron- 
ore capacity and reloading the same in canal barges. Such arrangement is 
outlined by sketch 1, showing a 2-ton grab bucket operated by a movable steam 
steeple tower which discharges coal to the storage bunkers of approximately 
the capacity of the boat, from which storage it is discharged directly to the 
canal barge. 

(1) At a maximum-capacity rate of 500 tons per hour, 5,000 tons 
per 10-hour day, 800,000 tons G months—160 days: 


Unloading machinery costs_$100, 000. 00 

Operating cost per ton_ . 70 

Fixed charge per ton_ 1. 25 

Reloading machinery costs_ 50, 000. 00 

Operating cost per ton_ . 14 

Fixed charges_ . 625 


For unloading from boats and storing in pile on ground which could extend 
back from the shore a distance of 500 feet. Such an arrangement as outlined 
by sketch 4, showing a grab bucket operated on a mast and gaff, for unloading 
to elevated hopper, from which point the coal is distributed to pile on land by 
automatic railway. 


(2) At a maximum-capacity rate of 50 tons per hour, 500 tons 
per 10-liour day, 80,000 tons 6 months—160 days: 

Unloading machinery costs___ 

Operating cost per ton_ 

Fixed charge per ton_ 

Storing machinery costs_ 

Operating cost per ton_ 

Fixed charge per ton_ 


$ 6 , 000 . 00 
. 02^7 
.75 

2 , 000 . 00 
.42 
.25 


1 Not printed. 






















WATVnW AY FROM LAKE SUPERIOR TO MISSISSIPPI RI VEIL 1G7 


This is a standard arrangement of coal-handling machinery for the noted 
capacities. The machinery is simple and rugged and the entire plant can be 
operated with one engineer and two ordinary laborers. 

(3) For unloading from boats and transferring on trestle 30 feet high to a 
distance of 1,200 feet at any point on this line, coal could be deposited in 
storage on ground or discharged through chutes reloading to railroad cars. 
Such an arrangement is outlined by sketch 2, which shows a grab bucket 
operated on a movable steam steeple tower which operates on a trestle about 
30 feet high. 

At a maximum capacity rate of 750 tons per hour, 7,500 tons per 
10-hour day, 1,200,000 tons G months—1G0 days: 

Unloading machinery costs_$150, 000. 00 

Operating cost per ton_ . 70 

Fixed charge per ton_ 1 . 25 

Transfer machinery costs_ 85, 000. 00 

Operating cost per ton_ . 25 

Fixed charge per ton_ . 71 

For unloading from boats and transferring to storage pile or to railroad cars 
or reclaiming from storage pile and reloading to railroad cars or to barges. 
The arrangement is outlined by sketch 3 and shows the complete system of un¬ 
loading, storing, reclaiming, and reloading either to railroad cars or barges. 
The sketch shows the plant arranged for a capacity of 500 tons per hour. A 
plant of similar operation can be arranged for any desired capacity by increasing 
the number of units. 


At a maximum capacity rate of 500 tons per hour, 5,000 tons per 


10-hour day, 800,000 tons G months—1G0 days: 

Unloading machinery costs_$100, 000. 00 

Operating cost per ton_ . 70 

Fixed cost per ton_ 1. 25 

Transporting machinery costs_ 105, 000. 00 

Operating cost per ton_ . 25 

Fixed cost per ton_ 1. 31 

Reclaiming machinery costs_ 150, 000. 00 

Operating cost per ton_ 1. 00 

Fixed cost per ton_ 1. 87 


By referring to our catalogue you will see a detailed description of the equip¬ 
ment and operation of plants constructed along similar lines to those noted 
above. 

The amount of damage that coal sustains in being handled depends to a 
great extent on the ultimate use of the coal. The extent of damage to bitu¬ 
minous coal occasioned by handling in plants such as described will be a very 
small percentage. If the coal is to be used in boiler plants, the breaking is of 
advantage rather than otherwise, as it is necessary to crush run-of-mine coal 
before it can be economically fired by automatic stokers. 

Where large storage of coal is desired, the arrangement as shown by sketch 
3 permits the use of subaqueous storage as well as dry storage. By storing 
the coal under water the danger of spontaneous combustion is eliminated and 
the deterioration of coal stored under water is less than stored in the open. 

We trust that the inclosed estimates will answer your requirements in 
sufficient detail for your present purpose. 

Yours, very truly, * 


C. W. Hunt Co. (Inc.), 
Fred E. Murphy, 

Assistant Chief Engineer. 


Exhibit VII. 

[The Brown Hoisting Machinery Co., patent automatic hoisting and conveying appliances, 

50 Church Street.] 


New York, October 23, 1913. 

Mr. F. N. Stacy, 

Room No. 118, Holland House, New York City. 

Dear Sir : We beg to acknowledge receipt of your favor of the 22d, and are 
sending you, under separate cover our catalogue “ Q ” covering ore and coal 


















168 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


handling machinery, also a few photographs showing coal-handling plants which 
we have built. 

In reference to cost of unloading this depends upon the circumstances under 
which the unloading is done; that is, whether the coal is simply brought to a 
bin on the edge of the dock, or carried back to a stock pile. It also depends 
somewhat on the vessel, as to the size of the hatches and convenience of getting 
at the coal. We would say that this cost would be from 2 cents to 5 cents a 
ton, and in some cases may exceed tliie price of 5 cents. 

coal. We would say that this cost would be from 2 cents to 5 cents a ton, and 
in some cases may exceed this price of 5 cents. 

We feel, if your could spare the time, that it would be well worth your while 
to stop off at our works at Cleveland, Ohio, where they have full information 
in regard to what has been done by our company in the Lake Superior district. 

Trusting, however, that what we are sending you now will answer your 
purposes for the present, we are, 

Yours, truly, 


The Brown Hoisting Machinery Co., 
Richard Devens, 

Manager Eastern Office. 


Exhibit VIII. 

TThe McMyler Interstate Co., Cleveland, Ohio, car dumpers, locomotive cranes, ore and 
coal handling machinery, orange-peel, clam-shell and scraper buckets, railroad equip¬ 
ment. New York Branch, room 1756-50 Church Street.] 

New York, October 28, 1913. 

Mr. F. N. Stacy, 

Lake Superior and Mississippi River Canal Commission, St. Paul, Minn. 
Dear Sir : With further reference to your letter of October 22, we inclose 
herewith photograph 1 showing machinery for unloading coal from lake vessels 
to cars or storage hopper, or from lake vessels to canal barges; also from canal 
barges to dock at canal or river terminals. 

Two of these machines have unloaded the steamship Transportation as 
follows: 


Number of tons unloaded first day of 9 hours_ 4, 200 

Number of tons unloaded second day of 8 hours_2, 321 

Total_6,521 


Size of steamer: Length, 376 feet; beam, 49 feet; depth, 30 feet; number of 
hatches, 9; size of hatches, 26 feet by 12 feet 6 inches. 

This rate of unloading includes complete cleaning up of steamer. 

We estimate that the cost of unloading coal under these conditions should 
not exceed 2 cents per ton for labor, fuel, and repairs. This cost does not in¬ 
clude the interest on the first cost of the machinery and wharf. 

If storage back of the machines is desired we can furnish steam or electrically 
operated bridge tramways of any desired unloading and storage capacity. 

Y T ours, very truly, 

The McMyler Interstate Co. 


Exhibit IX. 

[Mead-Morrison Manufacturing Co., coal handling and hoisting machinery, Singer 

Building, 149 Broadway.] 

New York City, September 26, 1913. 

Mr. F. N. Stacy, 

Statistician, Lake Superior & Mississippi River Canal Commission, 

State Capitol Building, St. Paul, Minn. 

Dear Sir : Acknowledging yours of the 25th in reference to the handling and 
storing of coal in connection with the Lake Superior & Mississippi River Canal: 
Taking up in order the questions asked in your letter: 

1. What character of coal-hoisting plant would you recommend for unloading 
coal from lake ore-carrying barges, at the Duluth-Superior docks and loading 

1 Not printed. 








WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 169 


into canal barges, such plant to have 1,000,000 tons capacity for a navigating 
season of six months? 

Answer. We would recommend a plant for unloading consisting of 7 towers, 
steam or electrically operated, with or 2 ton grabs delivering to cable road 
which would convey the coal from towers to storage bunkers located along the 
water front from which the coal could be delivered to the canal barges, or the 
cable road could be so arranged as to deliver direct to the canal barges without 
the intermediary storage bins. The advantage of the bins would, of course, be 
that the coal would be available at all times for loading the canal barges 
whether a lake steamer happened to be alongside or not. 

The type of tower that we would suggest is similr to those used on the lakes 
at such plants as the Northern Coal & Dock, Superior, Wis., Duluth, Missabe 
& Northern Railway, Duluth, Minn., Hanna Coal & Dock Co., Superior, Wis. 

A plant as described above would have an unloading capacity of about 1,000 
tons per hour. 

(c) What would be the cost of the required hoisting and conveying machinery 
alone? 

Answer. The cost of the unloading towers, cable road, and supporting struc¬ 
tures, exclusive of foundations, would be about $400,000. 

(b) What would be the aggregate cost of plant complete, with storage ca¬ 
pacity of 500,000 tons, and auxiliary for weighing and screening? 

Answer. The cost of a plant as above, with an unloading capacity of about 
1,000 tons an hour and a storage capacity of 500,000 tons, with auxiliary screen¬ 
ing plant and track scales for weighing the coal, would be about $1,000,000. 
This would include the foundations, superstructures, and machinery, but not 
the cost of the land. 

(c) What would be the labor and fuel cost per ton for operating such plant? 

Answer. We would estimate the labor cost per ton at about 21 cents and the 

fuel cost at about one-half per cent per ton, making a total of 3 cents per ton of 
coal handled. 

( d ) What would be total cost per ton for operating and fixed charge, includ¬ 
ing depreciation, repairs, and interest on investment, not including site, at the 
interest rate of 4 per cent? 

Answer. On the basis of 1,000,000 tons handled in six months, we would 
estimate the cost per ton as above, at 12 cents. This cost would, of course, 
be very much reduced if the quantity of coal handled was doubled by running 
night shifts, in which case the cost might be brought down to 7 cents or 8 cents. 

2. What character of coal-handling plant would you recommend for unloading 
coal from canal barge of 200 to 800 tons at canal and river terminals? 

Answer. For small capacities, not in excess of 500 tons per day, we would 
recommend a mast and gaff grab bucket equipment. If the capacity required 
was in excess of 500 tons, say, up to 1,000 tons per day, we would recommend 
unloading towers, steam or electrically operated, with 1-ton grab. These towers 
would be of our standard equipment, similar to that installed for the Interbor¬ 
ough Rapid Transit Co., Fifty-ninth Street and North River, shown on page 25, 
catalogue No. 15. 

(a) What would be the cost of the coal-handling machinery for plant capable 
of unloading 500,000 tons in six months, hoisting to 100-foot level and conveying 
1,000 feet? 

Answer. We estimate the cost of a plant to fulfill the above requirements at 
$250,000, exclusive of foundations. 

(&) What would be total cost of such plant installed, not including cost of 
land, with storage capacity of 250,000 tons? 

Answer. We estimate the cost of a plant as above described, not including 
the cost of land, but including the superstructures with machinery and founda¬ 
tions, at $450,000. 

(c) What would be labor and fuel cost per ton for such unloading at canal 
and river terminal? 

Answer. We estimate the labor and fuel cost for unloading at canal and river 
terminals at cents per ton. This on the basis of unloading being done by 
means of automatic machinery in quantity and not where hand-filled tubs 
would be used. 

( a ) What would be total cost per ton, including operating and fixed charge, 
interest at 4 per cent, not including taxes and dividend on investment? 

Answer. We estimate the cost on the above basis at 12 cents per ton. 

3. What would be cost of plant for unloading on dock from canal barge 500 
tons per day, and what would be cost per ton for operating such plant? 


170 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Answer. The cost of plant for unloading about 500 tons per day from canal 
barge would be about $7,000. The cost for operating such a plant, for labor 
and fuel, on the basis of 500 tons per day, would be about 4 cents per ton. 

4. Kindly name some of the principal points where coal-hoisting machinery 
of the character named has been installed by you. 

Answer. We would refer you to our cataloguges No. 15 and No. 16, copies of 
which we hand you herewith. Most of the unloading plants with large storage 
are located on the Great Lakes around Duluth and Superior. Besides the 
plants shown in catalogue No. 15, we have recently installed some electrically 
operated man-trolley bridges for the Pittsburgh & Lehigh Dock Co., Duluth, 
the Milwaukee Western Fuel Co., Sixteenth Street dock, Milwaukee, and the 
Semet-Solvay Co., Detroit, Mich. 

Now, as to your question regarding the degradation of coal when being 
handled from boats and from box cars. We have no positive data on this 
subject. The opinion seems to prevail among coal dealers here in the East that 
the loss in handling anthracite coal is between 5 cents and 10 cents per ton for 
each breaking of bulk, no matter how accomplished. Bituminous coal, of course, 
will not lose as much in the breaking of bulk. We should say there would be 
no greater loss in handling coal from boats than in handling from box cars, for 
the reason that the units in which the coal is handled when taking from boats 
are larger than the units when handled from box cars, in addition to which, 
when transportation is made by car, there is the degradation due to the motion 
of the car. 

We trust that the above will be of assistance to you and will be very glad to 
give you any further information within our power. 

Yours, truly, 


Mead-Morrison Manufacturing Co., 
O. G. Dale, New York Manager. 


Exhibit X. 

[Department of Docks and Ferries, The City of New York. Bureau of Ferries, Office of 
Superintendent, Ferry Terminal Building, corner Whitehall and South Streets.] 

New York, September 30, 1913. 

Mr. F. N. Stacy, 

Statistician, Lake Superior and Mississippi River Canal Commission. 

Sir: Replying to your request for information in connection with the annual 
delivery of coal and cost per ton of handling the same at our St. George pockets, 
I would advise you as follows: 

First. Total annual deliveries amount to approximately 65,000 tons. The 
coal delivered is anthracite of pea size. 

Second. The unloading plant consists of a steam-driven, double-drum inclined 
ways clam-shaped bucket hoist. The hoist is approximately 80 feet, and the 
bucket will hold approximately 1 ton. The coal is unloaded from the bucket into a 
receiving hopper, and passes from the receiving hopper into the weighing 
hopper, holding approximately 3,500 pounds when full. The rate of discharge 
of the coal from the receiving hopper to the weighing hopper is controlled by 
the weighmaster through the medium of a swinging gate. After weighing, the 
coal is discharged from the weighing hopper into the loading chute over a 
pivoted bucket conveyor, by means of which it is distributed throughout the 
coal bunkers. The coal bunkers have a capacity of approximately 1,800 tons, 
and the travel of the conveyor to distribute the coal throughout the bunkers is 
approximately 150 feet. The coal conveyor is motor driven, current for the 
same being furnished by the local electric light plant. 

Third. The operating cost per ton of coal unloaded from the barge is as 


follows: 

1 coal hoist engineer-per day__ $4. 50 

1 laborer for weighing and tending conveyor_do_ 2. 50 


Total-do_ 7. 00 


Or a total cost of $2,555 per year. 

The coal for hoisting purposes, 13 tons per month, at $4 per ton, plus mis¬ 
cellaneous supplies, cost $650 per year. 

Cost of power for the conveyor motor. $250 per year. 








WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 171 


Total cost of unloading 65,000 tons per year, $3,455, or 5nr cents per ton. 

The 65,000 tons per year is not the maximum capacity of the plant, but it is 
all that the plant is required to handle in order to meet the demands. Coal is 
delivered alongside in barges holding from 600 to 800 tons. The cost of trim¬ 
ming is borne by the contractor delivering the coal, and is not included in the 
above. 

Fourth. The total unloading cost per ton, including operating expenses, de¬ 
preciation of plant and interest on plant investment: The depreciation of the 
plant has been found to be negligible, in that in the six years this plant has been 
in service approximately no repairs have been required to maintain the same in 
an efficient and operating condition other than what could be made by the men 
assigned to operate the same. 

The coal pockets and hoist were constructed as part of a contract, including 
other terminal buildings, waiting rooms, etc., hut it is estimated that the coal 
pockets and hoist alone would involve for first cost an expenditure of $50,000, 
the interest charges on which would be at the rate of 4 per cent per annum, 
$2,000 per year, making the total cost, including interest on plant investment 
and depreciation for hoisting 55,000 tons, or $5,455 per year; or approximately 
8.4 cents per ton. 

Fifth. With a plant operating full capacity it is estimated that not less than 
400 tons per 8-hour day would be hoisted, at which rate the maximum unload¬ 
ing capacity of the plant would he not less than 146,000 tons per year, assum¬ 
ing that the plant is operated only 8 hours during any one day. 

The cost of operation for coal for the hoist and power for the motor would 
be increased approximately in proportion to the amount of coal hoisted, so 
that the cost per ton of coal unloaded from barge, including operating ex¬ 
penses, depreciation of plant, and interest on plant investment, with the plant 
unloading 146,000 tons per year, would be: 

Labor, $2,555. 

Fuel for the hoist, 27 tons per month, at $4 per ton, including miscellaneous 
supplies, $900 per year. 

Power for coal-conveyor motor, $550 per year. 

Interest on plant investment at 4 per cent per annum, $2,000. 

Or at the rate of approximately 4.1 cents per ton. 

I trust this will furnish you with all the information you desire. Any 
further information that you may require will be forwarded to you upon your 
request for the same. 

Very respectfully, 


P. Hanley, 

Superintendent of Ferries. 


172 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER, 


Exhibit XI. 


Comparison of United States rail and European water rates. 1 

1. COAL. 



Rail dis¬ 
tance. 

Rail rate. 

Water 

rate. 

Per cent 
water of 
rail rate. 

RHINE. 

Ruhrort to Mannheim. 

Miles. 

202.45 

Per ton. 2 
SI. 88 

Per ton 2 
SO. 409 

21.8 

Town, State rat.es . . 

200-210 

1.32 


30.9 

Illinois State rates. 

200-210 

1.11 


36.8 

Hooking coal district, to lake front 

s 220 

.85 


48.1 

Ruhrort to Strassburg. 

267.65 

2.26 

.726 

32.1 

Towa State rates . . 

260-270 

1.44 


50.4 

Illinois State rates. . 

260-270 

1.21 


60 

Fairmount coal district to Lorain . 

3 274 

.97 


74.8 

Ruhrort to Frankfort-on-the-Main. 

176.14 

1.64 

.474 

28.9 

Iowa State rates. 

175-180 

1.24 


38.2 

Illinois State rates. . 

175-180 

1.06 


44.7 

California, Pa., to Coshocton, Ohio (Pennsylvania R. R.l . 

173 

.95 


50 

ELBE. 

Hamburg to Magdeburg. 

156 

1.50 

.64 

42.7 

Iowa State rates. 

150-160 

1.18 


54.2 

Illinois State rates. 

150-160 

1.02 


• 62.7 

Pittsburgh No. 8 district to lake front . 

3 150 

.88 


72.7 

Hamburg to Berlin. 

174 

1.69 

.71 

42 

Iowa State rates. 

170-175 

1.225 


57.9 

Illinois State rates. 

170-175 

1.05 


67.6 

West Newton, Pa., to Cleveland, Ohio (Baltimore & Ohio) 

190 

1.00 


71 

Hamburg to Breslau. 

370 

2.86 

1.48 

51.8 

Iowa State rates. 

370-380 

1.66 

89.1 

Illinois State rates. 

360-380 

1.37 


108.0 

Thacker coal district to Sandusky. 

3 365 

.97 


152.6 

Hamburg to Dresden. 

286 

2.36 

1.24 

52.5 

Iowa State rates. 

280-290 

1.48 

83.8 

Illinois State rates. 

280-290 

1.24 


100 

Kanawha district to Toledo. 

3 325 

.97 


127.8 




2. GRAIN. 


RHINE. 

Miles. 

Per ton. 2 

Per ton. 2 


Rotterdam to Mannheim. 

298 

$5. 81 

JO. 626 

10.8 

Iowa State rates: 





Wheat, flour, millet, and flaxseed. 

290-300 

2. 70 


23.2 

27.9 

25.9 
28.7 

24.1 

19.3 

Corn, oats, barley. 

290-300 

2. 24 


Illinois State rates: 

Wheat__'.. 

290-300 

2.42 


( ther grains. 

290-300 

2.18 


Fremont, Iowa, to Chicago (Chicago, Burlington & Quincy 
R. R.)—Wheat. 

296.6 

2.60 


Rotterdam to Strassburg. 

362.66 

5. 71 

1.102 

Iowa State rates: 





Wheat, flour, millet, and flaxseed. 

360-370 

3.08 


35.8 

43 

42.4 
46.7 

55.1 

17.5 

Corn, oats, barley. 

360-370 

2. 56 


Illinois State rates: 

Wheat. 

360-380 

2.60 


< ther grains. 

360-380 

2. 36 


Rochester,~N. Y., to Harrisburg, Pa. (Pennsylvania R. R.)— 
Wheat. 

356 

2.00 


Rotterdam to Frankfort-on-the-Main. 

282. 56 

4.36 

.764 

Iowa State rates: 




Wheat, flour, millet. 

280-290 

2.66 


28.7 

34.7 

32.1 
35.4 

38.2 

Com, oats, barley. 

280-290 

2.20 


Illinois State rates: 

Wheat. 

280-290 

2. 38 
2.16 

2.00 


Other grains. 

280-290 


Burnham,"Pa., to New York City (Pennsylvania R. R.)— 
Wheat. 

267 





1 The United States rail rates were obtained from the Interstate Commerce Commission and the Bureau 
of Railway Economics. They are all commodity rates in carload lots. The German rail and water rates 
are taken from the tables given above. 

2 The foreign rates are for the metric ton of 2,204 pounds, the American rates are for the short ton of 2,000 
pounds, and hence should be increased by 10 per cent in order to be strictly comparable. 

s Estimated. 



































































































WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER, 173 


Comparison of United States rail and European water rates —Continued. 

2. GRAIN—Continued. 



Rail dis¬ 
tance. 

Rail rate. 

Water 

rate. 

Per cent 
water of 
rail rate. 

ELBE. 

Hamburg to Magdeburg. 

Miles. 

156 

Per /on.' 
2.97 

Per ton. 1 
50.67 

22.5 

Iowa State rates: 

Wheat, flour, millet, and flaxseed. 

155-160 

1.96 

34.2 

Corn, oats, barley. 

155-160 

1.62 


41.3 

Illinois State rates: 

Wheat. 

155-160 

1.90 


35.3 

Other grains. 

155-160 

1.72 


39 

Neal, Kans., to Kansas City, Mo. (Missouri Pacific)—Wheat... 
Hamburg to Breslau. 

1.50 

2.00 


33.5 

379 

6.81 

1.55 

22.8 

Iowa State rates: 

Wheat, flour, millet, and flaxseed. 

370-380 

3.14 

49.4 

Common barley. 

370-380 

2.62 


59.1 

Illinois State rates: 

Wheat. 

360-380 

2.60 


59.6 

Other grain. 

360-380 

2.37 


65. 4 

Oakley, Kans., to Kansas City, Mo. (Union Pacific)—Wheat... 
Hamburg to Dresden. 

377 

2.90 


53.5 

286 

5.21 

1.26 

24.2 

Iowa State rates: 

Wheat, flour, millet, and flaxseed. 

280-290 

2.66 

47.4 

Corn, oats, barley. 

280-290 

2.20 


57.3 

Illinois State rates: 

Wheat. 

280-290 

2.38 


53 

Other grain. 

280-290 

2.16 


58.3 

Rutledge. Mo, to Chicago (Atchison)—Wheat. 

287 

2.40 


52.5 

Hamburg t.o Breslau. 

174 

3.28 

.79 

24.1 

Iowa State rates: 

Wheat, flour, millet, and flaxseed. 

170-175 

2.02 

39.1 

Corn nat.s, liar ley.... 

170-175 

1.68 


47 

Illinois State rates: 

Wheat ..... 

170-175 

1.96 


40.3 

Other grain . 

170-175 

1.78 


44.4 

LewisburgT Pa., to Wilmington, Del. (Pennsylvania R. R.)— 
W heat . 

185 

2.00 


39.5 




i The foreign rates are for the metric ton of 2,204 pounds, the American rates are for the short ton of 2,000 
pounds, and hence should be increased by 10 per cent in order to be strictly comparable. 























































174 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Exhibit XII. 

Western States IAne—Canal and lake. 

WESTBOUND RATES. 

[Class rates in cents per 109 pounds.) 


To- 

First class. 

Second class. 

Third class. 

Fourth class. 

Fifth class. 

Sixth class. 

Rule 25. 

Rule 26. 

Rule 28. 

Cleveland, Ohio. 

40 

35 

28 

19 

17 

15 

30 

22 

22 

Detroit, Mich.1 

41 

37 

29 

20 

17. 

16 

31 

23 

23 

Chicago, Ill.1 

Milwaukee, Wis.| 

Sault Ste. Marie, Mich. 1 .J 

Duluth, Minn. 

Superior, Wis. 

Hancock, Mich. 

42 

38 

29 

22 

19 

17 

32 

23 

241 

Houghton, Mich.• 

Dollar Bay, Mich. 

Marquette, Mich. 1 . 

48 

43 

33 

25 

22 

20 

361 

26 

28 

Minneapolis, Minn.. 

63 

56 

42 

30 

26 

22 

48 

34 

33 

GROUP POINTS. 










St. Paul, Minn. 

63 

56 

42 

30 

26 

22 

48 

34 

33 

Altamont, Ill. 

57 

51 

40 

29 

25 

22 

43 

32 

33 

Annawan, Ill. 

59 

53 

41 

29 

25 

23 

45 

33 

33 

Atkinson, Ill. 

60 

54 

42 

30 

26 

23 

46 

34 

34 

Aurora, Ill. 

48 

44 

34 

24 

21 

19 

37 

27 

271 

Carthage, Ill. 

62 

55 

43 

31 

27 

24 

47 

34 

35 

Danville, Ill. 

45 

41 

32 

23 

20 

18 

35 

26 

26 

Galva, Ill. 

58 

52 

41 

29 

25 

22 

44 

33 

33 

Joliet, Ill. 

45 

41 

32 

23 

20 

18 

35 

26 

26 

Kankakee, Ill. 

45 

41 

32 

23 

20 

18 

35 

26 

26 

Laura, Ill. 

57 

51 

40 

29 

25 

22 

43 

32 

33 

Mason City, Ill. 

54 

49 

38 

27 

24 

21 

42 

30 

31 

Moline, Ill. 

67 

60 

48 

35 

30 

26 

52 

39 

39* 

Monmouth, Ill. 

62 

55 

43 

31 

27 

24 

47 

34 

’ 35 

Neponset, Ill. 

56 

51 

40 

28 

25 

22 

43 

32 

32 

Peoria, Ill. 

53 

48 

37 

27 

23 

21 

41 

30 

301 

Racine, Wis. 

45 

41 

32 

23 

20 

18 

35 

26 

26' 

St. Louis, Mo. 

Streator, Ill. 

58 

52 

41 

29 

25 

22 

44 

33 

33 

53 

48 

37 

27 

23 

21 

41 

30 

301 

Westvilie, Ill. 

51 

46 

36 

26 

22 

20 

39 

29 

291 

Trans-Mississippi. 

58 

52 

41 

29 

25 

22 

44 

33 

33 


1 The rates to Marquette and Sault Ste. Marie do not include the dockage at those places, this company 
having no docks at these points. 





























































WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 175 


Anchor Line—Rail and lake. 

WESTBOUND RATES FROM NEW YORK. 
[Class rates in cents per 100 pounds.] 


To— 

c n 

<73 

■*-> 

m 

Lh 

E 

Second class. 

Third class. 

Fourth class. 

Fifth class. 

Sixth class. 

Rule 25. 

Rule 26. 

Cleveland, Ohio. 

50 

43 

34 

23 

20 

17 

36£ 

27 

Detroit, Mich. 

Chicago, Iil. 

51 

45 

35 

24 

20 

18 

38 

28 

Milwaukee, Wis. 

Sault Ste. Marie, Mich. 1 . 

Duluth, Minn... 

Hancock, Mich. 

• 02 

54 

41 

30 

25 

21 

46 

33 

Houghton, Mich. 

Marquette, Mich. 1 . 

Superior, Wis. 

► 08 

59 

45 

33 

28 

24 

50 

36 

GROUP POINTS. 









St. Paul, Minn. 

83 

72 

54 

38 

32 

26 

61 

43 

Altamont, 111. 

77 

67 

52 

37 

31 

26 

57 

42 

Annawan, Ill. 

79 

09 

53 

37 

31 

27 

59 

42 

Atkinson, 111. 

80 

70 

54 

38 

32 

27 

59 

43 

Aurora, Ill. 

68 

00 

46 

32 

27 

23 

51 

37 

Carthage, Ill. 

82 

71 

55 

39 

33 

28 

00 

44 

Danville Ill. 

65 

57 

44 

31 

26 

22 

48 

32 

Galva, Ill. 

78 

08 

53 

37 

31 

26 

58 

45 

Joliet, 111. 

05 

57 

44 

31 

26 

22 

48 

35 

Kankakee, Ill. 

65 

57 

44 

31 

26 

22 

48 

35 

Laura, Ill. . 

77 

67 

52 

37 

31 

26 

57 

42 

Mason City, Ill. 

74 

65 

50 

35 

30 

25 

55 

40 

Moline, Ill. 

87 

76 

60 

43 

36 

30 

65 

49 

Monmouth, Ill. 

82 

71 

55 

39 

33 

28 

60 

44 

Neponset, Ill. 

76 

67 

52 

36 

31 

26 

57 

42 

Peoria, Ill. 

73 

64 

49 

35 

29 

25 

54 

39 

Racine, Wis. 

65 

57 

44 

31 

26 

22 

48 

35 

Streator, 111. 

73 

64 

49 

35 

29 

25 

54 

39 

Westville, Ill. 

71 

62 

48 

34 

28 

24 

53 

38 

St. Louis, Mo. 

78 

68 

53 

37 

31 

26 

58 

42 

Trans-Mississippi. 

78 

68 

53 

37 

31 

26 

58 

42 


i The rates to Marquette and Sault Ste. Marie do not include the dockage, this company having no docks 
at these points. 


\ 



















































176 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER 


Average rates on iron ore, per long ton, from ports named to Ohio ports, 

1885-1911. 


Year 

Escanaba. 

Marquette. 

Ashland and other 
head-of-lake ports. 

Wild or 
daily 
rate. 

Contract 

rate. 

Wild or 
daily 
rate. 

Contract 

rate. 

Wild or 
daily 
rate. 

Contract 

rate. 

1885. 

$0. 78 

80.90 

80.98 

81.05 

81.25 

81.15 

1886. 

1.28 

1.05 

1.51 

1.20 

1.78 

1.20 

1887. 

1.59 

1.40 

1.87 

1.63 

2.23 

2.00 

1888. 

1.05 

.90 

1.30 

1.15 

1.43 

1.25 

1889. 

1.01 

1.00 

1.19 

1.10 

1.34 

1.25 

1890. 

.89 

1.10 

1.07 

1.25 

1.17 

1.35 

1891. 

.84 

.65 

1.02 

.90 

1.11 

1.00 

1892. .... 

.74 

1.00 

.98 

1.15 

1.15 

..25 

1893. 

.56 

.85 

.71 

1.00 

.77 

1.00 

1894. 

.47 

.60 

.60 

.80 

.78 

.80 


.73 

.55 

.92 

.75 

1.13 

.80 

1896. 

.52 

.70 

.66 

.95 

.77 

1.05 

1897. 

.45 

.45 

.55 

.65 

.57 

.70 

1898. 

.51 

.45 

.60 

.60 

.62 

.60 

1899. 

.95 

.50 

1.08| 

.60 

1.291 

.60 

1900. 

. m 

1.00 

.78 

1.10 

.841 

1.25 

1901. 

.64 

.60 

.79 

.70 

.89 

.80 

1902. 

.59 

.60 

.66 

.70 

.77 

.75 

1903. 

.61 

.65 

.72 

.75 

.81 

.85 

1904. 

.53$ 

.55 

.62 

.60 

.70 

.70 


.61 

.60 

.70 

.70 

.77 

.75 

1906. 

.60 

.60 

.70 

.70 

• 75| 

.75 

1907. 

.60 

.60 

.70 

.70 

.75 

.75 

1908. 

.50 

.50 

.60 

.60 

.65 

.65 

1909. 

.52 

.50 

.61 

.60 

.66 

.65 

1910. 

.55 

.55 

.65 

.65 

.70 

.70 

1911. 

.45 

.45 

.55 

.55 

.60 

.60 


Charge to vessel in 1901 for trimming and unloading, 22 cents per ton; 1902,19 cents per ton; 1903, 21 cents 
p^r ton; 1904, 19 cents per ton; 1905, 1906, 1907, 1908, 1909, 20 cents per ton; 1910 and 1911, 15 cents per ton. 
Wooden vessels requiring trimming paid an additional charge of about 3 cents per ton in 1902, 1903, 1904, 
1905, 1906, 1907, 1908, 1909, 1910, and 1911. 


Average rates on hard coal from Buffalo and soft coal from Ohio ports to Lake 
Superior and Lake Michigan ports, 1892-1911. 



Hard 

coal. 

Soft coal. 

Year. 

Chicago. 1 

Duluth. 

Milwau¬ 

kee. 1 

Esca¬ 

naba. 

Duluth. 

Green 

Bay. 

Mani¬ 

towoc. 

Hancock- 

Hough- 

ton. 

Sheboy¬ 

gan. 

1892. 

59 

43 

58 

43 

43 

55 

49 



1893. 

49 

29 

48 

40 

38 

50 

41 



1894. 

46 

25 

484 

39 

37$ 

494 

48 



1895. 

59 

24 

54 ‘ 

39 

364 

50' 

51 



1896. 

36 

24 

33$ 

27 

29' 

324 

32 



1897. 

29 

26 

28$ 

29$ 

26 

30 

31 



1898. 

28 

23 

28 

264 

23 

28$ 

28$ 

29.7 

27.8 

1899. 

73 

49$ 

69 

58 

45$ 

66$ 

67 

56.4 

66.5 

1900. 

48 

39$ 

45 

40 

40 

45 

43$ 

41.3 

43.6 

1901. 

50 

38 

49 

46 

38 

48$ 

48 

39.5 

45.3 

1902. 

42 

33 

46$ 

41$ 

34$ 

46$ 

42 

31.8 

41.9 

1903. 

48 

38 

50$ 

45 

41$ 

50$ 

46 

40.0 

45.9 

1904. 

43 

34 

47 

40 

37 

45$ 

47 

35.6 

40.6 

1905. 

44 

34 

46$ 

414 

33$ 

42 

41$ 

35.3 

41.525 

1906. 

46 

35 

46 

42 

35 

42 

42 

42.0 

42.0 

1907. 

40 

31 

40 

35 

30 

35 

35 

50.0 

35.0 

1908. 

40 

30 

40 

35 

30 

35 

35 

30.0 

35.0 

1909. 

41 

32 

37 

31 

31 

32 

31 

31.25 

31.25 

1910. 

41 

314 

354 

35 

31 

35 

35 

31.0 

35.0 

1911. 

35 

30 

32 

31 

32 

31 

31 

32.0 

31.0 


1 Rates to Milwaukee and Chicago are practically the same. 

Note.—C oal of all kinds is shipped in short tons and handled without charge to vessels. 



















































































WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 177 


Interstate Commerce Commission, 

Division of Statistics, 
Washington, September 15, 1913. 


Mr. F. N. Stacy, 

Holland House, New York, N. Y. 

Dear Sir: In reply to your inquiry of September 12, I regret to say that I 
have not yet been able to secure any data directly bearing upon the subjects of 
your inquiry. I inclose herewith a page from the December, 1911, Summary of 
Internal Commerce which gives (on p. 584) the average charges for trimming 
and unloading iron ore. I have consulted the dockets of several recent cases 
decided by the commission, viz: 

Boileau Case, 22 I. C. C., 640; 

Pittsburgh Vein Operators’ Case, 24 I. C. C., 280; 

Pittsburgh Steel Company, Opinion No. 2328; 
and fail to find the data which you desire. The loading charges on coal from 
car to vessel vary between 5 and 10 cents per ton. ' 

At the recent fifth annual convention of the International Fuel Association a 
paper was read on modern locomotive coaling stations, in which data are given 
showing the cost of installation, operation, and maintenance of various types 
of clam shells. By writing to the secretary of the association, Mr. C. G. Hall, 
922 McCormick Building, Chicago, you may possibly procure a copy of the 
proceedings. I would also suggest that you communicate with the manufac¬ 
turers of these shells for data regarding the practical operation of up-to-date 
unloading machinery. I have referred your inquiry to the tariff and account¬ 
ing divisions of the commission and shall forward to you the results of their 
inquiries. 

Respectfully, 


M. Jacobson, 
Associate Statistician. 


Average annual wheat rates by canal shipments between Buffalo and New 
York for the period 1888-1909 varied between 2.2 and 5 cents per bushel. The 
averages for the 1908 and 1909 seasons are given as 5 and 3.9 cents, respectively. 
(Average monthly and season rates are given in the Monthly Summary of Com¬ 
merce and Finance, December, 1909, p. 1165.) 


Exhibit XIII. 

American Steel & Wire Co., 

30 Church Street, 

Neiv York City, October 27, 1913. * 

Mr. F. N. Stacy, 

Holland House, Room 118, New York City, N. Y. 

Dear Sir: Referring to conversation had with our Mr. Kuhn with regard 
to proposed tramways, for transporting various materials between point of 
manufacture or production to canal wharves, would say that it is very difficult 
to give very close figures in the absence of definite data as to profile of the 
ground, showing the exact horizontal distances and elevations and exact re¬ 
quirements at terminal stations, but for preliminary figures would say that 
tramway having a length of half a mile, a capacity of 75 tons per hour or 750 
tons per day of 10 hours, would cost approximately $7,500 to $8,000 for the 
material which we would furnish—which would include all the cables, traction 
rope, carriers, machinery, and metal work for the intermediate supports and 
terminal stations, including all bolts for erecting the structures and attaching 
the machinery, and complete set of working drawings for the erecting of the 
tramway. 

To this should be added the cost of furnishing the necessary timber for all 
structures and the erecting of same in place and installation of our tramway 
material, as well as freight from our works to destination. This would make 
an additional cost of approximately $4,000 to .>6,000, making the entire tram¬ 
way installation cost in the neighborhood of $12,000 to $14,000 erected and 
ready to run. 

As previously stated, these figures are very rough, and we believe if we had 
proper data so as to lay out tramway to fit the actual conditions we would be 
able to revise our figures and make them appear more favorable. 


H. Doc. 1008, 64-1-12 




178 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


As to cost of operation, the various catalogues and pamphlets left with you 
will give you some idea in this regard, but for the particular tramway instal¬ 
lation outlined above, would say, assuming that you wish to transport flour 
in sacks, which would require the greatest amount of labor at the tramway 
terminals, this cost would amount to approximately $27.10 per day, divided 
as follows: 

Per day. 


Interest on the investment at 6 per cent_ $5.60 

Depreciation and maintenance, about 5 per cent on $9,000_ 3.00 

Labor (including 1 foreman at $4, 6 laborers at $2 each)_ 16.00 

Oil and grease_ .50 

Power, approximately _ 2.00 


These figures are based on running the tramway for six months in the year, 
or for a total of 150 days, and based on a daily capacity of 750 tons the trans¬ 
portation charges would be 3.6 cents per ton. If it is desired to carry hack 
freight over tramway, this could be done without any additional charge except 
possibly in the matter of power. 

As stated by our representative, if our proposition should be favorably received 
and it was definitely decided to install this method of transportation, we would 
be pleased to make arrangements for one of our engineers to visit the proposed 
locations of tramway equipment and make any recommendations necessary for 
satisfactory and economical operation and installation as well as advising you 
as to the correct data to furnish for our requirements for making up the neces¬ 
sary estimates and drawings. 

There are over 3,000 Bleichert aerial tramways in successful operation 
throughout the world—in capacities ranging from a few hundred pounds to 250 
tons per hour, with lengths of lines varying from a few hundred feet up to 22 
miles, and with operating costs running from 1 to 5 cents per ton per mile—and 
from the fact that we have been able to install this number of tramways and 
give complete satisfaction both as to operation and maintenance leads us to 
believe that there is no question but what we could furnish equipments for 
your requirements which would give you the same service and satisfaction. 

We shall, therefore, look forward to hearing further from you with regard 
to these proposed improvements, and assuring you of our prompt and careful 
attention to all inquiries, we are, 

Your, truly, 


American Steel & Wire Co., 
W. E. Corne, Sales Agent. 


Exhibit XIV. 

JOINT RESOLUTION Memorializing Congress in favor of a canal connecting Lake 
Superior with the Mississippi River via the Brule and St. Croix Rivers, and providing 
for the appointment of a commission to promote tlie construction thereof and to act in 
conjunction with commissions appointed by other States. 

Whereas the Congress of the United States, by two several and separate acts, 
passed in the years eighteen hundred and ninety-four and eighteen hundred 
and ninety-nine, authorized and directed two separate surveys and examina¬ 
tions of three proposed routes for a canal connecting Lake Superior with the 
Mississippi River, one of said routes being from Lake Superior to the Missis¬ 
sippi River via the Saint Louis River, one via the Rum River and one via 
the Brule and Saint Croix Rivers; and 

Whereas after an actual examination and survey of said several proposed routes, 
the United States Government engineers did report in the year 1894 that the 
most feasible route for said canal is the route from Allouez Bay on Lake 
Superior via the Brule and Saint Croix Rivers to the Mississippi River, and 
recommended said route; and 

Whereas in the year eighteen hundred and ninety-nine the United States Govern¬ 
ment engineers did again report that a canal from Lake Superior to the Mis¬ 
sissippi River via the Brule and Saint Croix Rivers was entirely feasible; that 
in the first of said reports of said Government engineers it was estimated that 
said canal could be constructed seven feet deep, eighty feet in width at the 
water surface, and fifty-nine feet in width at the bottom thereof, for the sum 
of $7,059,000; and in the second of said reports it was estimated that said 
canal could be built eighty feet in width at the water line, fifty-nine feet in 
width at the bottom, and five feet deep, for the sum of $6,012,500; and 








WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 179 


Whereas the project of constructing said canal has not been authorized by 
Congress because of reports of said engineers to the effect that the con¬ 
struction of said canal was not warranted owing to existing railroad com¬ 
petition and the cost of said canal as compared with the benefits to be derived 
from the construction thereof; and 

Whereas it conclusively appears from the surveys and examinations of the route 
made by the Government engineers that it is entirely feasible and practicable 
to construct and operate said canal along the route specified from Allouez 
Bay on Lake Superior via the Brule anti Saint Croix Rivers to the Mississippi 
at the junction of the Saint Croix and Mississippi Rivers, and the only objec¬ 
tions which apparently prevent Congress from authorizing said project are 
the existence of railway competition and the doubt expressed by said engi¬ 
neers as to the amount of commerce which would be carried upon said canal; 
and 

Whereas no survey or examination appears to have been made or authorized 
by the United States Government of said route to ascertain whether the 
same could be constructed and operated at a depth of ten feet, nor as to 
whether a canalization of the Mississippi River by the construction of a dam 
below the junction of the Saint Croix and Mississippi Rivers would be prac¬ 
tical which would in fact extend said waterway so as to connect the cities 
of Minneapolis and Saint Paul with the cities of Duluth, Minnesota, and 
Superior, Wisconsin, by means of said canal and the canalization of said 
Mississippi River; and 

Whereas millions of consumers and producers of the Northwest and the Missis¬ 
sippi Valley are vitally interested in the construction of said canal and the 
improvement of said Mississippi River so as to form a complete and continuous 
inland waterway from the Mississippi Valley and the Twin Cities to the At¬ 
lantic seaport via the Great Lakes, thus enabling all of the products of the 
Eastern States and the States bordering on the Great Lakes to be shipped 
by water to all points in the Northwest and the Mississippi Valley and the 
agricultural and other products of the Northwest to be shipped by water to 
the markets of the world; and 

Whereas at all of the hearings held upon the question of the commercial neces¬ 
sity of said canal and waterway a great mass of producers and consumers 
interested have had no adequate opportunity to be effectively heard, and 
there is no lawfully constituted authority, official, or commission of this State 
authorized or empowered to ascertain and present the facts or collect data 
and statistics relating to commerce bearing upon this important subject; and 
Whereas the State of Wisconsin and the people of said State are also greatly 
interested in the construction of said canal and waterway: Now, therefore 
be it 

Resolved by the House of Representatives of the State of Minnesota (the Sc7i- 
ate concurring) , That the construction of said canal by the National Govern¬ 
ment is of the greatest importance to this State, the State of Wisconsin, the 
Mississippi Valley, and the Nation; that its construction will be a great na¬ 
tional addition to existing facilities of commerce; and it would constitute a 
natural, adequate, and automatic means of reducing transportation rates on 
all commodities between the Mississippi Valley, the great Northwest, the Great 
Lakes, and the Atlantic seaports, and that it would tend to reduce rates upon 
coal, iron, steel, manufactured articles, grain, and other agricultural products 
and would greatly benefit the consumers and producers of the East and the 
West and reduce the cost of the necessities of life. 

Resolved further , That the governor of this State, the drainage engineer of 
this State, the chairman of the board of railroad and warehouse commissioners 
be, and they are hereby, appointed a commission, of which the governor shall 
be’chairman, which shall be known as the Lake Superior and Mississippi River 
Canal Commission, and said commission is hereby granted power and . uthority 
and is hereby directed to investigate and ascertain all of the facts with refer¬ 
ence to practicability and cost of construction and operation of said canal, 
utility thereof, and the character and amount of commerce which would prob¬ 
ably be carried or affected by said canal, and tbe probable effect of the con¬ 
struction and operation thereof upon transportation rates and upon the con¬ 
sumers and producers of the Northwest, and especially the States of Minne¬ 
sota and Wisconsin: Provided , however, That the expenses of such commission 
in carrying out the provision hereof shall not exceed the sum of $2,500. Said 
commission is hereby directed to lay before the United States engineers and 


180 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


any other Federal commission, board, or authority having jurisdiction of any 
question relating to the construction of said canal by the United States Govern¬ 
ment all of the facts, conclusions, statistics, data, information, and views 
ascertained and gathered by said commission bearing upon the advisability and 
practicability of the construction of said canal by the Federal Government, 
and to make or cause to be made any and all arguments deemed necessary 
by said commission in favor of said canal, and to use their best efforts to fur¬ 
ther the project of the construction thereof, and to report to the legislature at 
the session of nineteen hundred and fifteen all of their acts and doings in the 
premises. 

Resolved further, That said commission is also authorized and directed to 
confer and act with any commission designated or appointed with the State of 
Wisconsin, or any other State interested in the construction of said canal, and 
to act with any such commission in any and all of the matters hereinbefore set 
forth. 

Resolved further, That the State of Wisconsin is hereby requested and in¬ 
vited to constitute and appoint a like commission for the purpose of consulting 
and cooperating with said commission hereby appointed for the purpose of 
furthering the project of constructing said canal. 

Resolved further, That the Senators and Representatives in Congress of 
the United States for the State of Minnesota are hereby requested to urge 
upon Congress the adoption of an act authorizing the final survey of said 
canal at a depth of ten feet, together with the extension of said canal by means 
of the canalization of the Mississippi River to the cities of Saint Paul and 
Minneapolis, and to urge upon Congress the final construction of said canal 
by the United States Government. 

Resolved further, That a copy of this resolution be sent to the Senate and 
House of Representatives of the United States and to each of the Senators 
and Representatives in Congress from this State, and that a like copy be 
transmitted by the governor of this State to the governor of Wisconsin and to 
the president of the senate and speaker of the Assembly of the State of Wis¬ 
consin. 

Approved, March 31, 1913. 


Exhibit XV. 

Chapter 651.—AN ACT Creating the Lake Superior and Mississippi River Canal Com¬ 
mission, prescribing its duties, and creating section one hundred and seventy-two— 
one hundred and twenty-one of the statutes, making an appropriation. 

The people of the State of Wisconsin, represented in senate and assembly, do 
enact as follows: 

Section 1. There is created a commission to be known and designated as 
the Lake Superior and Mississippi River Canal Commission. Such commission 
shall consist of three members, to be appointed by the governor within thirty 
days after the passage and publication of this act. 

Sec. 2. Such commission shall, within forty days after the passage and 
publication of this act, organize by choosing one of its members as president 
and one as secretary. 

Sec. 3. It shall be the duty of the Lake Superior and Mississpipi River 
Canal Commission, hereby created, and said commission is hereby granted 
power and authority to investigate and ascertain all the facts with reference 
to the practicability and the cost of construction and operation of a canal from 
Lake Superior to the Mississippi River via the Brule and Saint Croix Rivers, 
the utility thereof for the purposes of creating water power and the character 
and amount of commerce which would probably be carried or affected by said 
canal, and the probable effect of the construction and operation thereof upon 
transportation rates and upon the consumers and producers of the Northwest, 
and especially the States of Minnesota and Wisconsin. Said commission "is 
hereby directed to lay before the United States engineers and any other 
Federal commission, board, or authority having jurisdiction of any question 
relating to the construction of said canal by the United States Government all 
of the facts, conclusions, statistics, data, information, and views ascertained 
and gathered by said commission bearing upon the advisability and practica¬ 
bility of the construction of said canal by the Federal Government, and to 
make or cause to be made any and all arguments deemed necessary by said 



WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 181 


commission in favor of said canal, and to use their best efforts to further the 
project of the construction thereof. 

Sec. 4. The said commission is also authorized and directed to confer and 
act with any commission or other body designated or appointed by the State of 
Minnesota, or any other State interested in the construction of said canal, 
and to act with any such commission or other body in any and all of the 
matters set forth in section three of this act. Said commission shall, after its 
organization, notify any such commission or other body designated or appointed 
by any other State of such organization and its desire to cooperate with such 
commission or other body, and shall thereafter act as herein provided. 

Sec. 5. Said commission shall report its acts and doings to the governor, from 
time to time as he may request and shall report to the next session of the 
legislature all of its acts and doings, with such recommendations for further 
legislation as it may deem expedient. 

Sec. G. The members of said commission shall serve without salary, but shall 
be paid their actual expenses necessarily incurred in the performance of their 
duties under this act. All payments under this section shall be made on proper 
vouchers signed by the president and secretary of said commission. 

Sec. 7. There is added to the statutes a new section to read: 

“ Sec. 172-121. There is appropriated on July first, nineteen hundred and 
thirteen, the sum of $2,500, payable from any moneys in the general fund not 
otherwise appropriated, for the Lake Superior and Mississippi River Canal 
Commission to carry out the provisions of this act.” 

Sec. 8. This act shall take effect and be in force from and after its passage 
and publication. 

Approved, July 21, 1913. 


Appeal of Minnesota and Wisconsin Canal Commissions to the Board of 
Engineers for Rivers and Harbors, Washington, D. C., in the Matter of 
Lake Superior-Mississippi Canal—Supplemental Data and Argument for 
Construction of Canal. 


(June 13, 1914.) 

[George II. Sullivan, Stillwater, Minn., counsel for Minnesota Canal Commission ; E. F. 
Ackley, Chippewa Falls, Wis., counsel for Wisconsin Commission.] 


PROJECTED CANAL FROM LAKE SUPERIOR TO MISSISSIPPI RIVER 
VIA BRULE AND ST. CROIX RIVERS. 

SUPPLEMENTAL STATEMENT. 

Should the Lake Superior-Mississippi River Canal be constructed by the 
United States? 

It is conceded that the answer to the foregoing question depends upon the 
favorable solution of two problems: 

1. Is it physically practicable to construct and operate such canal? 

2. Is the proposed canal commercially feasible? 

It is entirely practicable to construct and operate the canal. 

It was freely conceded by the local board of the United Slates Army Engi¬ 
neers that it is easily practicable and feasible from a physical and engineering 
standpoint to construct and operate the canal. This conclusion of the local 
board rests upon the authority of all United States Government engineers who 
have examined the proposed route, its physical characteristics, water supply, etc. 
Not only is the construction and operation of the canal feasible and practicable, 
but it presents no unusual or difficult engineering or operating problem. 

COMMERCIAL FEASIBILITY. 

Is the proposed canal commercially feasible, or, as this problem is stated by 
the local board, will the operation of the canal result in saving the public in 
reduced freight rates $420,000 per annum? 



182 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


This problem presents the following factors: 

1. At what rate will the canal carry freight? 

2. What amount of tonnage will be available for canal transportation in 
1920 when the canal will be ready for operation? 

3. Will the construction of the canal result in a saving on freight rates 
between the head of the Lakes and Twin City territory? 

4. Will the total saving equal $420,000 per year? 

CANAL RATE. 

We have shown in our original argument that on the Erie Canal, operating 
under extremely unfavorable conditions as to cost of transportation, such as 
failure to keep canal in repair, resulting in reduced depth of channel; use of 
ancient type of canal boat—maximum 240-ton capacity—with animal motive 
power; entire absence of modern terminal facilities; canal traffic controlled by 
railways, preventing canal from securing through freight; it was during a 
period when improvement in type of barge or character of motive power could 
not be made because the fate of the canal was uncertain—the average rate was 
2 mills per ton-mile. 

We have shown in our original argument that with the favorable conditions 
that would necessarily obtain at the time of the opening of the projected canal, 
including modern terminals with adequate facilities for handling freight, self- 
propelled modern type of canal boat having capacity of 550 tons, canal free 
from railway domination or control, the rate for the projected canal should be 
much less than 2 mills per ton-mile on the average, and that upon coal it 
should not exceed 11 mills per ton-mile—one authority, John H. Bernhard, 
placing the coal rate as low as 25 cents per ton. 

We therefore confidently assert that it is safe and conservative to conclude 
that the average rate on the projected canal would not exceed 2 mills per ton- 
mile, especially in view of the immense volume of tonnage hereafter shown to 
be available to the canal at the moment it is ready to operate. Coal can be 
and will be carried on the canal at 11 mills per ton-mile at the highest. 

Unwarranted extra handling charges of freight transported by canal used 
by local board to defeat commercial feasibility of canal. 

In their comparison of the respective costs of transportation via rail and 
canal the local board not only assumes an average canal rate of 3 mills per 
ton-mile or 78 cents per ton, which is 28 cents per ton in excess of the rate 
calculated at 2 mills per ton-mile, which we have shown to be the proper 
rate; but, in addition thereto, in order to make a finding that it is impossible 
to transport any freight on the canal, the board adds to the canal rate various 
handling charges for which there is little, if any, basis in fact, such as 25 
cents per ton for unloading coal from the canal barge to the dock by clamshell; 
25 cents per ton deterioration; 25 cents per ton for delivery from dock to 
carload consumer; elevator charges on grain at Twin Cities, 25 cents per ton; 
and at Duluth, 25 cents per ton; handling charges on flour at Duluth, 22 to 33 
cents per ton; handling charge for general merchandise 25 cents per ton; the 
same charges on iron and steel; and 44 cents charges per ton on coarse grain at 
Duluth. 

As shown in our original argument, most of the foregoing charges do not 
exist and there is no reliable commercial or other authority for them. It 
only costs 5 cents per ton to take the coal from the lake vessels, put it on 
the dock, screen it, and load it into the cars. This operation can be done 
as cheaply at the Twin Cities. (See the testimony of Julius Barnes, hereinafter 
quoted. Deterioration of coal in one handling by clamshell is too small to be 
commercially noticeable (original argument). Elevator charges on grain at 
Twin Cities and Duluth must be paid whether transported by rail or by canal; 
handling charges on flour at Duluth must be paid when carried by rail and 
transferred to a lake vessel, and such charges, with modern terminals, should 
not exceed 6 cents per ton. The general merchandise handling charges should 
not exceed 6 to 10 cents per ton. 

TRANSPORTATION BY CANAL INVOLVES AT MOST ONLY ONE EXTRA HANDLING CHARGE. 

Any fair comparison of the various operations necessary in the transporta¬ 
tion of commodities from the Great Lakes to the Twin Cities, or vice versa, 
between canal and rail transportation, demonstrates that at the most there 





WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 183 


can be but one additional handling of freight in canal transportation that is 
not also required in rail transportation of the same commodity. 

Take the case of coal, for instance. The only additional handling of coal— 
in order to deliver the same to Twin City consumers when transported by 
canal is to take the coal from the lake carrier and place it in the canal barge. 
When the coal reaches the Twin Cities it occupies exactly the same relative 
position to further transportation as the same coal did originally when in 
the hold of the carrier at Duluth. It must be taken from the barge by coal- 
handling machinery and deposited in an adjacent coal yard or loaded into 
cars in exactly the same manner as would be necessary at Duluth. So that 
such coal is properly chargeable with only the cost of taking the coal from 
the lake carrier and placing it on the barge. This can be done by elevating 
the coal to a coal pocket in the dock with a chute running down it suitable 
to deliver the coal by gravity to the barges as called for. The figures are given 
for the cost of this operation as ranging from 3 to G cents per ton. We think it 
is conservative to add a charge of 5 cents. 

When coal is transported from Duluth to the Twin Cities by rail, as at 
present, it is delivered on the sidetrack to carload consumers without addi¬ 
tional switching charges, although, under recent rulings of the Interstate 
Commerce Commission, undoubtedly shippers, in the near future, will be 
required to pay an extra charge for similar switching. A small proportion 
(but not over 50 per cent) of the Twin City consumers take coal in carload 
lots on the sidetrack. A switching charge from the dock to the sidetrack of 
$2 per car would cover such consumption, making a net charge of 2| cents 
per ton on all coal shipped. However, all coal shipped from Twin Cities to 
southern, southwestern Minnesota and South Dakota points would not carry 
the extra 21 cents per ton. 

As to grain shipped from the Twin Cities to Duluth, practically none is 
cleaned at country elevator points and therefore upon receipt at Twin Cities 
goes into elevators to be cleaned and mixed with other grain to give it a higher 
grade. Once being in an elevator at the Twin Cities, whether it is shipped 
via rail or canal, makes no difference in the elevator charge. All grain going 
into elevators in the Twin Cities will take the same charge whether delivered 
from the elevator to cars or canal boats. To charge grain for an extra 
handling at the Twin Cities is unwarranted except as to the small proportion 
thereof which is not placed in an elevator at the Twin Cities. 

From the statement of the local board it would appear that grain transported 
by canal to Duluth would take an extra elevator charge at Duluth for being 
transferred from canal boat to lake carrier and that such elevator charge would 
not also be applicable to grain transported by rail. This is absolutely inac¬ 
curate and is not and can not be justified from any standpoint or by any 
authority. 

All grain arriving at Duluth by rail must pay the elevator charge for being 
transferred to lake vessels. 


FLOUR. 

Flour is now loaded by hand trucks from mill to car and the local board 
makes no charge against rail on this account. Flour can be loaded from mill 
to canal boat at a cost no greater than the present cost of loading cars. 

All flour shipped by rail to Duluth is charged 10 cents per ton for transfer 
from car to lake vessel. As will be hereafter seen, flour can be handled by 
modern terminal facilities from canal boat to lake vessel for G cents per ton. 

General merchandise is charged 25 cents per ton extra for delivery from lake 
vessel to canal boat. This charge should not exceed G cents per ton, as shown 
by the testimony of Julius Barnes, hereinafter quoted, and by reference to 
similar charges at New Orleans and San Francisco, hereinafter quoted. 

If proper terminals are provided at each end of the canal, it is clear that 
freight transportation via canal involves only one extra handling and that the 
canal with modern terminals will reduce all handling charges of freight be¬ 
tween the lakes and the Twin Cities from the present rates as well as reduc¬ 
ing the present rail rates. 

Therefore, in any comparison of rail and canal transportation only one 
handling charge should be added to the canal rate, and, as seen, the effect 
of canal construction with its modern terminals would be to more than offset 
the present handling charges by rail. 


184 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


The testimony of Julius Barnes, hereinafter quoted, shows that present 
handling charges from lake vessel to car or car to lake vessel on general 
merchandise is from six to fourteen times more than will be the case when the 
canal is built and modern terminals installed. Then handling charges involved 
in rail transportation will he much higher upon all commodities, except coal 
and grain, than like handling charges in connection with canal traffic. So 
that assuming the construction of modern terminals in connection with the 
canal—and we guarantee such construction—practically all of the handling 
charges assumed by the local board will be eliminated. Indeed, there will 
be a net reduction in the handling charges unless similar terminals are also 
constructed at Duluth for transfer from lake to rail, and in such event the 
handling charges to be debited to the canal, as compared with rail, will be 
too small a factor to affect the problem. 

AVAILABLE TONNAGE. 

The local board found from railway statements (sec. 31) that the actual 
coal, iron, and flour shipments in the year 1912 were as follows: 

Tons. 

Coal and iron_ 1, 954, 568 

Flour_ 223,170 


Total_ 2,177,738 

The board accepted as true the railway statement that the above constituted 
80 per cent of the total freight shipments for 1912. Therefore the board must 
have found the total actual shipments for 1912 to be 2,722,171 tons. (See sec. 
32-40.) 

The board then made an estimate of the tonnage to be added to the actual 
shipments for 1912 by adding certain percentages to the actual shipments of 
coal, iron, flour, etc., on account of the added consumption of the Canal Zone 
and territory tributory thereto. The result of such computations was that 
the board found the total actual and estimated tonnage available to the canal 
for 1912 to be 3,295,000 tons (sec. 41). It will be seen, therefore, that the board 
added to the total actual shipments 522,829 tons for the amount they estimated 
the shipments should be increased on account of increased territory. This was 
an addition of 20.3 per cent to the actual tonnage for 1912 according to railway 
statistics. 

As shown by the statement of the railways to the Minnesota Railroad and 
Warehouse Commission (original argument), the correct actual total tonnage 
for the year 1912 was 3,484,163 tons. Following the exact method followed by 
the local board in order to arrive at the total actual and estimated tonnage 
# available for shipment on the canal in the year 1912 would require the addition 
of 20.3 per cent to the total actual shipments for 1912, or 707,285 tons. 

This would give us, according to the method of the local board, a total— 
actual and estimated—of 4,191,448 tons available to the canal for the year 1912. 

Dividing this total according to the method applied by the local board (sec. 
41) we have: 



Per cent. 

Tons. 

Present 

rail 

rate. 

Soft coal. 

52.3 

2,192,127 
838,290 
4,191 
318,550 
419,145 
419,145 

$0.96 

1.20 

1.40 

1.16 

1.00 

1.16 

Hard coal. 

20.0 

Iron and steel. 

. 1 

Flour. 

7 6 

Grain. 

10.0 

General merchandise. 

10.0 




4,191,448 



Note.—T he rates on soft coal and flour increased from 90 cents and $1 to above figures since the report of 
Ihe local board; rate on hard coal decreased from $1.25 to $1.20. 


It appears from the reports of the railways to the Minnesota Railroad and 
Warehouse Commission, as shown in the original argument, that shipments 
between canal termini have increased since 1909 at the rate of 15 per cent per 




















WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 185 


annum. If such increase continues until 1920 it would make an increase over 
the year 1912 of 120 per cent. This would increase the total tonnage available 
in 1920 to 9,221,285 tons, which, divided according to the percentages applied 
by the local board above noted, would show the following result: 



Per cent. 

Tons. 

Soft coal. 

52.3 

4,822,732 
1,844,257 

Hard coal. 

20.0 

Iron and steel. 

.1 

9,222 




Per cent. 

Tons. 

Flour. 

7.6 

700,818 
922,128 
922,128 

Grain. 

10.0 

General merchandise. 

10.0 



It is not unreasonable to assume that the available tonnage will increase at 
approximately the same rate of increase noted between the years 1909 and 
1913, but we find that if such rate of increase be discounted one-third, never¬ 
theless the total tonnage available can not possibly fall short of 8,000,000 
tons. This would seem to dispose of the question of total tonnage available 
to the canal at the time it may be expected to be ready for business. Therefore 
it is beyond question or doubt that the volume of tonnage available to the 
canal when constructed will be sufficient so that at the canal rates herein 
shown there will be a saving to the public of a great deal more than $420,000 
per annum, and the canal is commercially feasible. 

CEMENT. 


It is stated upon reliable authority that the first unit of cement production 
at the new steel mills in Duluth will provide for a production of 1,000,000 tons 
per annum, and unquestionably the Twin Cities and territory included in the 
Canal Zone will use cement manufactured at the head of the Lakes. Other fac¬ 
tors noted in the original argument, will tend rather to increase the total ton¬ 
nage available rather than to decrease it, so it is conservative to estimate that 
the above totals will be increased rather than decreased. 

The canal is commercially feasible on the basis of the 1912 actual and esti¬ 
mated tonnage. 

COAL. 


We have seen that on the basis of total and actual shipments for 1912 the 
total coal available would be: 


Tons. 


Soft coal_ 2,192,127 

Hard coal_ 838, 289 


Rail rate. 


Soft coal_ $0- 

Hard coal_ 1-20 


Per ton. 


Assuming the canal rate to be \\ mills per ton-mile-$0. 37 § 

Unloading lake carrier and loading barge- . 05 

Delivery to sidetrack or carload consumers (only small 
part, not exceeding 50 per cent so delivered—cost 
5 cents per ton on 50 per cent)- • 02£ 


Total cost per ton via canal- .45 


Saving to public. 


Soft coal, 51 cents per ton-$1,117, 984. 77 

Hard coal, 75 cents per ton- 628, 71G. 75 

Total saving on coal- 1, 740, 701. 52 

































186 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER, 


Per ton. 


Assuming the canal rate to he 2 mills per ton-mile_$0. 50 

Unloading lake carrier and loading barge_ .05 

Delivery_ . 021 


Total cost per ton via canal_ . 571 


Saving to 'public. 


. Soft coal, 381 cents per ton_ $843, 968. 89 

Hard coal, 621 cents per ton_ 523, 930. 62 

Total saving on coal_ 1, 367, 899. 51 

Per ton. 

Assuming the canal rate to be 21 mills per ton-mile_$0. 621 

Unloading lake carrier and loading barge_ . 05 

Delivery_ . 021 

Total cost per ton via canal_ . 70 

Saving to public. 

Soft coal, 26 cents per ton_!_ $569, 953. 02 

Hard coal, 50 cents per ton_ 419,144. 50 

Total saving on coal_ 989, 097. 52 

Per ton. 

Assuming canal rate to be 3 mills per ton-mile_$0. 75 

Unloading lake carrier and loading barge_ . 05 

Delivery_ . 021 

Total cost per ton via canal_ . 821 

Saving to public. 

Soft coal, 131 cents per ton_ $295, 937.14 

Hard coal, 371 cents per ton_ 314,358.37 

Total saving on coal_ 610, 295. 51 


FLOUR. 

Total flour available 1912. 318,550 tons; rail rate, $1.16. 

Per ton. 


Assuming canal rate to be 11 mills per ton-mile_$0. 375 

Mill to barge_ . 036 

Unloading and loading at Duluth_ . 08 


Total cost per ton via canal_ . 491 

Saving to public, 318,550 tons, at $0,669 per ton, $213,109.95. 

Per ton. 

Assuming canal rate to be 2 mills per ton-mile_$0. 50 

Mill to barge_ .036 

Unloading and loading_ . 08 


Total cost per ton via canal_ . 616 

Saving to public, 318,550 tons, at $0,544 per ton, $173,291.20. 

Per ton. 

Assuming canal rate to be mills per ton-mile_$0. 625 

Mill to barge_ . 036 

Unloading and loading_ . 08 


Total cost per ton via canal_ . 741 


Saving to public, 318,550 tons, at $0,419 per ton, $133,472.45. 













































WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 187 


Per ton. 


Assuming canal rate to be 3 mills per ton-mile_$0. 75 

Mill to barge- .030 

Unloading and loading_ .08 


Total cost per ton via canal_ . 8G6 


Saving to public, 31S,550 tons, at $0,294, $93,653.70. 

Note. A charge of 3.G cents per ton is added for delivery of flour from mill 
to barge, which should he offset by present cost of loading from mill to car. 
Also 8 cents per ton from canal boat to lake carrier is 2 cents per ton more than 
warranted by testimony of Julius Barnes. San Francisco and New Orleans 
charges. 

GENERAL MERCHANDISE. 

Total general merchandise available, 419,145 tons; rail rate, $1.16. 


Per ton. 

Assuming canal rate to be 1$ mills per ton-mile_$0.37$ 

Handling charge, boat to barge_ . 10 


Total cost per ton via canal_ .47$ 

Saving to public, 419,145 tons, at $0.68$ per ton, $287,114.32. 

Per ton. 

Assuming caiuil rate to be 2 mills per ton-mile_$0.50 

Handling charge, boat to barge__ . 10 


Total cost per ton via canal_ . GO 

Saving to public, 419,145 tons, at $0.56 per ton, $234,721.20. 

Per ton. 

Assuming canal rate to be 2$ mills per ton-mile_$0. 62$ 

Handling charge_ . 10 


Total cost per ton via canal_1_ . 72$ 

Saving to public, 419,145 tons, at $0.43$ per ton, $182,328.07. 

Per ton. 

Assuming canal rate to be 3 mills per ton-mile_$0. 75 

Handling charge_,_ . 10 


Total cost per ton via canal_ . S5 

Saving to public, 419,145 tons, at $0.31 per ton, $129,934.95. 


VOLUME OF GENERAL MERCHANDISE. 

Julius Barnes, traffic expert, who made a statement to the local board, esti¬ 
mates in his statement before the House Committee on the Merchant Marine, 
hereinafter referred to, that the volume of general merchandise traffic on the 
Great Lakes would increase tenfold if handling charges from boat to rail and 
from rail to boat were made to conform to average charges at New Orleans 
and San Francisco, where modern terminals have reduced handling charge on 
freight to an average of 5 to 6 cents per ton. 

GRAIN. 

Rail rate, $1. 

Per ton. 


Assuming canal rate to be 2 mills per ton-mile-$0. 50 

Elevator charges, Twin Cities- . 25 


Total cost, per ton via canal- . 75 

Saving to public, 419,145 tons, at 25 cents, $104,786.25. 

Per ton. 

Assuming canal rate to be 1$ mills per ton-mile-$0. 3i$ 

Elevator charges- • 25 

Total cost per ton via canal- . 62$ 


Saving to public, 419,145 tons, at 3<$ cents, $157,1<9.38. 































188 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


The statements of the local board in sections 70-76 relative to grain would 
indicate that elevator charges at Duluth should be added to the canal rate; 
but this is absolutely incorrect. All grains going to Duluth by rail must pay 
elevator charges at Duluth in addition to rail rate. There is no lake-and-rail 
rate on grain. 

Unquestionably a much greater grain tonnage will be shipped via Duluth 
after construction of the canal on account of lower rate. 


Summary of saving on basis of actual and estimated shipments for the year 
1912, at various canal rates per ton-mile. 



3 mills. 

2 mills. 

1£ mills. 

Coal. 

i 610,295.51 
92,653.70 

$1,367,899.51 
173,291.20 
104,786.25 
234,721. 20 
3,352.80 

$1,746,701.52 
213,109.95 
157,179.38 
287,114.32 
3,876.68 

Flour. 

Grain. 

G eneral merchandise. 

129,934.95 

2,305.05 

Iron and steel. 

Total. 

836,189.21 

1,884,050. 96 

2,407,981.85 



Therefore it appears that even on the basis of the available tonnage for the 
year 1912 the canal is commercially feasible in that it will save more than 
$420,000 per year. But we have seen that the available tonnage is increasing 
at the rate of 15 per cent per annum; that it is improbable to suppose that 
the canal could be completed until 1920. It is therefore conservative and rea¬ 
sonable to add 120 per cent to the figures of the savings shown for 1912, which 
gives the following total saving: 


At various canal rates per ton-mile. 



3 mills. 

2 mills. 

li mills 

Coal. 

$1,342,550.12 
203,838.14 

$1,641,479.41 
381,240. 64 
230,529.75 
516,386.64 
7,376.16 

$3,842,743.34 
468,841.89 
345,794.63 
631,651.50 
8,528.69 

Flour. 

Grain. 

General merchandise. 

285,856.89 
5,071.11 

Iron and steel. 

Total. 

1,837,316.26 

2,777,012.60 

5,297,560.05 



CRITICISM OF METHODS OF LOCAL BOARD IN DETERMINING CANAL NOT COMMERCIALLY 

FEASIBLE. 

We assert that the method used by the local board at section 45 of their 
report, for the purpose of discussing the commercial availability of the canal, is 
productive of nothing but confusion. In this connection the local board say: 

“For the purpose of discussion several cases will be assumed (1) that the 
canal operating for seven months of the year will carry all the present freight, 
or 3,295,000 tons; (2) that the canal will carry 50 per cent of the entire freight, 
or 1,647,500 tons; (3) that the canal will carry 18 per cent of the entire freight, 
as the Erie Canal did in 1880, or 593,100 tons; (4) that the canal will carry 3 
per cent of the entire freight, as the Erie Canal did in 1906, or 98,850 tons; 

(5) that the canal will carry all freight except coal; ( 6 ) that the canal will 
carry all freight except soft coal; (7) that the canal will carry all grain and 
flour northward and all hard coal southward. 

“(a) Cost to the United States. —The canal to be commercially justified must 
save to the public at least $420,000 per annum, an amount equivalent to a re¬ 
duction of the selling price of the freight handled under the various conditions 
as follows: 


(1) 3,295,000 tons-$0.13 

(2) 1,647,500 tons_ .25 

(3) 593,000 tons_ . 71 

(4 ) 98,000 tons_ 4^25 

(5) 912,800 tons_ 46 

(6) 1,571,000 tons_ *27 

(7) 1,239,100 tons_ | 34 





































WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 189 


Not one of the entire seven assumed cases set forth by the local board in this 
portion of their report has any application whatever to the problem of the com¬ 
mercial feasibility of this particular project. 

As to the hrst case it assumes that the canal will carry all freight. We do 
not claim it. We claim it will affect all freight rates by materially reducing 
them. 

As to the second case, that the canal will carry 50 per cent of the entire 
freight, there is no basis for us to claim that percentage more than any other. 

As to the third and fourth cases, there is no possible basis for the assumption 
that the canal will carry 18 per cent of the entire freight, as the Erie Canal did 
in 1880, nor that it will carry 3 per cent, as the Erie Canal did in 1906. 

Neither is there any basis for the assumed case that the canal will carry all 
freight except coal. This case is the most unfavorable to the canal that could 
be assumed, because, as shown in our original argument, coal, both hard and soft, 
is peculiarly adapted to transportation by canal; that it forms 90 per cent of 
the tonnage on some of the most important canals in Europe. If the proposed 
canal will not carry coal, it will not carry anything, and to assume a case 
that the canal will carry all freight except coal is absolutely unfair to the canal. 
The importance of coal to the commercial feasibility of this canal is demon¬ 
strated by the actual figures hereinbefore quoted. 

That the canal will carry all freight except soft coal is likewise, and for the 
same reasons given last above, unfair to the canal. If the canal will not carry 
soft coal at a saving it probably is not commercially feasible. 

For the reasons above given with reference to the other cases assumed, the 
last case assumed by the local board that the canal will carry all grain and 
flour northward and all hard coal southward, is absolutely unfair. It is wholly 
artificial and the whole method of dividing the canal tonnage into the assumed 
cases mentioned in section 45 is artificial, without any basis or foundation in 
fact, and is a method of reasoning wholly unsuitable and inconclusive as to the 
problem presented. It is on a par with the statement of the local board at 
section 65 of their report that coal used for Government purposes will not move 
by the canal because there is a land-grant rate of 50 per cent on Government 
freight. 


FAIR METHOD OF DETERMINING COMMERCIAL FEASIBILITY. 

The only fair and reasonable method of determining the commercial feasi¬ 
bility of the canal is to determine the total available tonnage at the time the 
canal is completed, divide the tonnage so found into the various classes, such as 
soft coal, hard coal, iron, steel, cement, flour, and general merchandise, ascertain 
the rail rate upon each such commodity, and find the total freight paid at the 
present time to the railways. Then ascertain the canal rate as to each item and 
commodity to be transported; if there be a saving, subtract it from the rail rate 
and multiply it Ly the tonnage as to each commodity, and if the total saving 
equals $420,000 per annum, or if such amount should be found to equal the 
interest and maintenance charges, then the canal should be determined to be 
commercially feasible. 

The local board also seem to be inclined to credit the canal with freight actu¬ 
ally transported on the canal and not to credit the canal with any saving in any 
instance when the freight is transported by rail, even though carried at less than 
present freight rates, notwithstanding the reduction in freight rate be caused 
solely by the canal. We can not agree with this theory. It is our contention 
that "if the canal can haul any commodity at less than present rail rates this 
necessarily results in a public saving of the difference between present rail rates 
and canal rates and that the canal should be given credit for the whole amount 
saved on such freight moving in canal territory, whether the same he actually 
carried by canal or partly by rail or wholly by rail. It is quite possible and per¬ 
haps probable that the railways will meet canal competition by making rates 
which will be so low as to be noncompensatory as to the railways. It is not the 
object of the canal merely to reduce freight rates, but it is the bona fide object 
and purpose of such canal to actually transport freight at a considerable reduc¬ 
tion from present freight rates and effect a large public saving. How is it pos¬ 
sible for us to guess at what the railways will do when the canal demonstrates 
its ability to haul freight at less than existing rail rates? The question 
which lies at the root of the construction of the canal is whether such construc¬ 
tion will result in saving to the public a large amount of money each year by 
reason of the fact that water transportation via canal is essentially and inher- 


190 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER 


ently more economical and cheaper than rail transportation. If such he the 
fact, and the difference between rail and canal transportation per ton is suffi¬ 
cient when multiplied by the total tonnage so that the investment of the United 
States Government is a profitable one from the standpoint of public saving, it 
seems to us that the question of what the railways may do about reducing their 
rates or may undertake by other methods to meet or destroy canal competition is 
entirely outside of the present problem. That is a problem which properly 
addresses itself to Congress and to the executive authority for solution. We 
judge from the present temper of public opinion and from the investigations 
made by committees of Congress and from the present trend of legislation, that 
the question will be solved in such a way as to permit waterways to carry on 
their natural and normal functions. 

We therefore submit that the canal should be credited with all reductions in 
freight from existing rail rates caused or produced by the construction and 
operation of the canal, whether such freight is actually carried on the canal or 
otherwise. 

ELEVATOR CHARGES AT DULUTH ON GRAIN SHOULD NOT BE ADDED TO CANAL RATE. 

Statements of the local board in reference to handling charges on wheat and 
coarse grains, found in sections 70 to 76, inclusive, and at section 89, where 
such elevator charges are added to the canal rate on wheat and coarse grains 
producing a rate so high that neither wheat nor grain will move via the 
canal, are misleading. Such statements are made in a manner which might 
induce the belief that shipments of grain from the Twin Cities via Duluth 
to Buffalo are made on a lake-and-rail rate and that the rail rate of $1 per 
ton to Duluth includes elevator charges at the Twin Cities and Duluth and 
transfer of grain to lake carrier at Duluth. The fact is there is no lake-and- 
rail rate on wheat or grain from the Twin Cities to Buffalo or New York or 
other eastern points. Every shipment of wheat or grain from or through the 
Twin Cities or elsewhere to Duluth and to the east via the Great Lakes must 
pay in addition to the rail rate of $1 per ton from the Twin Cities to Duluth 
and in addition to freight charged on lake steamer the elevator charges at 
the Twin Cities and at Duluth and Buffalo. 

INCREASE IN GRAIN SHIPMENTS. 

If our statement is right that the canal rate will not exceed 2 mills per 
ton-mile on grain, the rate from the Twin Cities to Duluth should be 50 cents 
per ton, or 11 cents per bushel less than the present rail rate of 3 cents per 
bushel. There will be a proportionate reduction in grain rates from all Missis¬ 
sippi River points. And whereas under present conditions and rates there have 
been large exports of wheat and grain from the Twin Cities and Twin City 
territory to easterly points via Duluth, the decreased canal rate will necessarily 
increase the area from which such shipments will move which will logically 
result in a very greatly increased volume of such grain shipments. 

With the completion of the Erie Canal in 1915 or 1916 the grain outlet from 
Duluth to the seaboard will be all water and entirely free from railway con¬ 
trol, resulting in a cheaper rate from Twin City and Mississippi River territory 
to the seaboard. This factor will largely increase the area tributary to the 
Twin Cities and Mississippi River from which grain will move east via Duluth, 
and proportionately enlarge the volume of grain available for canal shipment. 

FLOUR. 

The rail rate quoted on flour by the local board from Minneapolis to Duluth 
is $1 per ton, but the Railroad and Warehouse Commission of Minnesota on 
June 27, 1914, state such rate to be $0,058 per hundred or $1.16 per ton. 

In arriving at the conclusion that the canal will not carry flour (sec. 81) the 
local board say it will cost 22 cents per ton to transfer flour from barge to 
steamer at Duluth, which, added to the canal rate of 78 cents, leaves nothing 
for public saving. In section 81 the local board states the cost of such transfer 
of flour as 33 cents per ton. The local board then state: 

“ The vessels carrying flour on the Great Lakes are railroad-owned; the 
railroads need flour as freight, particularly in winter; they are convenient to 
the mills at Minneapolis and the docks at Duluth; and who can be so filled with 
optimism as to believe that flour would be transported by canal to Duluth and 
there received on equal terms by railroad-owned vessels even if the canal rate 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RTYER. 191 


could compete with the railroad rate? * * * the railroad-owned steamer 

in Duluth is not going to make it easy for the independent barge owner who 
has hauled the freight naturally belonging to the railroads. Much flour now 
goes to the shores of Lake Michigan for shipment east, being hauled over roads 
in which it is stated the mills are interested. It is believed that it would 
require a great reduction in freight rates to make the flour mills desert the 
railroads, and the canal can not bring about this reduction. The flour mills 
can not be blamed for desiring to favor the railroads, as they would be abso¬ 
lutely dependent upon them live months in the year if the canal were built.” 

By adding the handling charge of 22 cents to canal rate of 78 cents assumed 
by the local board in connection with the above statement, the local board 
conclude the canal can not carry flour. 

It is obvious that if the handling charge of 22 to 33 cents per ton is excessive, 
and it is practical to reduce it to 5 or G cents per ton, the conclusion of the 
local board is without foundation. Of course the canal rate stated by the 
board of 78 cents is at least 28 cents too high. 

But in connection with the excessive character of the handling charge partic¬ 
ularly we earnestly invite the attention of the general board to the testimony 
of Julius H. Barnes, chairman of the traffic committee Duluth Chamber of 
Commerce, found in volume 2 of the hearings of the House Committee on the 
Merchant Marine under date January 31, 1913, at pages 839 to 863, inclusive. 
The testimony of Mr. Barnes is vitally pertinent and valuable because at the 
hearings of the local board on January 15, 1913, he appeared in opposition to 
this canal project, and it is in part upon the strength of statements made by 
Mr. Barnes to the local board that the latter concluded this project not com¬ 
mercially feasible. We should like to quote Mr. Barnes’s testimony in full and 
to reproduce his written statement filed in connection therewith, because in our 
opinion it presents one of the best arguments we have seen in favor of the con¬ 
struction of this canal. Mr. Barnes testifies particularly with reference to 
traffic conditions and handling charges on package freight, flour, and general 
merchandise. With reference to handling charges he says, on page 844: 

“ They have electrically equipped coal docks that will take coal out of a boat 
and carry it across and deliver it right onto the waiting railroad car for dis¬ 
tribution at a cost of not more than 3 or 4 cents per ton, and it often costs less 
than that. This method handles freight cheaply at both ends, but not package 
freight, for which we are paying the same as we did 40 years ago, a trans¬ 
shipping charge of 30 or 40 or 50 or even 60 cents on merchandise per ton at 
each end. 

“Mr. Humphrey. How about your terminal facilities? Are those under the 
control of the railroad? 

“ Mr. Barnes. Ours are; yes, sir. 

“ Mr. Wilson. What would you suggest as a means of remedying that? 

“Mr. Barnes. This is what I would suggest: I think the Government should 
build and lease and operate on the Lakes proper modern terminals for package 
freight. I do not believe the railroads will ever do it. I do not believe indi¬ 
vidual enterprise can do it as long as the present conditions exist.” 

In his written statement, with reference to excessive handling charges, on page 
861, Mr. Barnes says: 

“How can it he corrected? San Francisco is correcting it by installing mod¬ 
ern unloading and handling apparatus, which will economically handle general 
freight from and to a steamer. We understand they have fixed a charge there, 
which covers their operating expense, at 5 cents per ton. 

“ New Orleans has done something of the same sort, and we understand their 
charge is 6 cents per ton for that service. On the Great Lakes the regular scale 
for taking commodities from the steamer and landing them simply on the dock 
runs from 21 to 40 cents per ton; and to take it from the dock again and put it 
in the car, 12 to 30 cents per ton more. 

“ The new electrically equipped coal docks in Duluth, operated by coal com¬ 
panies for the reduction of their own expenses, take coal from the hold of a 
steamer, carry it across the dock, and load it into a waiting car at a cost of 3 
to 4 cents per ton. The same service on general freights through a railroad 
freight house would cost 33 to 65 cents per ton, and if it must he stacked in the 
freight house and piled, because for any reason it can not make a direct transfer, 
the charge runs easily 5 to 15 cents per ton additional. Put this charge on each 
end of the Great Lakes in handling general merchandise and see how far away 
from the Lakes at each end this cumbersome and unnecessary transshipping 
charge reflects to the aid of competing rail lines. 


192 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


“ Of course, they will keep it as high as they can. Of course, they will make 
the transshipping of freight from a railroad to vessels just as high as can be 
excused and maintain it for just as long as possible. 

“ The elimination of an unnecesarily high shipping charge is not the only 
economy to he attained by the application of modern methods to Lake trans¬ 
shipping. Here is a comparison: One grain elevator at the head of the Lakes 
has a record of loading into vessels in one 10-hour day 1,250,000 bushels of 
grain; one ore dock at the head of the Lakes has a record of having loaded into 
a steamer 9,450 tons of ore in 25 minutes; one coal dock at the head of the Lakes 
has a record of having unloaded from a vessel onto its docks in 10 hours and 20 
minutes nearly 9,000 tons of coal. 

“In package freight, if conditions are very favorable, three days are suf¬ 
ficient to unload 3,500 tons of general freight, but usually more would he 
required, while for loading the more uniform freight eastbound of mill stuffs 
5,000 tons could be loaded in from two to three days. Somebody is paying for 
all that idle time of the package freight boat.” 

The substance of Mr. Barnes’s testimony that present handling charges on 
general merchandise package freight, including Hour, is from 61 to 14 times too 
much. In other words, that it should be 5 to 6 cents and that it runs from 33 
to 70 cents per ton. 

He testifies and clearly shows that these handling charges are solely 
occasioned by reason of the fact that since 1S90 the railroads have owned 
practically all the through boat lines from Duluth and Chicago to Buffalo and 
eastern lake ports. That they have made no improvements over the old-time 
gangplank methods of loading and unloading freight; that they have failed 
to install modern terminals and facilities for loading and unloading freight 
for the express purpose of preventing such freight from going on the Lake and 
diverting it to all rail routes. He shows that the railroads, through their 
ownership of lake vessels, have constantly increased lake rates until the 
difference between lake rates or lake and rail rates and all rail rates is so small 
as to induce shippers to ship all rail, there being not sufficient saving on the 
Lake route to warrant such shipments. Thus it is seen that railway control and 
high handling charges deprive the purchaser and consumer of the benefit of 
low rates on the Lakes. That the only low freight rates on the Lakes are rates 
on coal, iron and grain and such rates are low only because independent boats 
owning their own docks, elevators, and coal and ore loading and unloading 
facilities, are thus beyond railway control. 

Mr. Barnes shows rather conclusively that with the exception of coal, iron 
ore, and grain the lake transportation upon which the Government has ex¬ 
pended more than $100,000,000, is of no particular benefit to the public by way 
of reduced freight rates. Particularly is this true of communities situated 
at a distance of 100 to 150 miles from the Lakes, as in the case of Minneapolis. 
Mr. Barnes shows that with modern terminal facilities on lake ports the 
freight on flour from Minneapolis to eastern points should be reduced 20 cents 
per barrel (p. 863). 

Mr. Barnes proposes in his testimony and statement that the Government 
should build and lease or operate on the Lakes modern terminals for package 
freight. He does not believe individual enterprise can do it under present con¬ 
ditions. He estimates that the amount of general merchandise handled on the 
Lakes, with proper terminals, would be increased tenfold, (p. 846.) 

As to the effect of modern terminals and reasonable charges, we again quote 
from Mr. Barnes’s testimony (p. 862) : 

“ Now, when the railroad interest is, as we have shown, directly opposed to 
improving those handling facilities, when the record of 40 years shows that 
they will make no attempt to improve those facilities, when the record of 30 
years shows that every saving the Government gives them, with other inde¬ 
pendent carriers, the benefit of in the way of improving carrying capacity by 
larger channels and better navigation facilities will not be reflected in lower 
rates but in higher on all the traffic that they can control and monopolize, then 
we believe it is time for the General Government itself to take strong and 
efficient action.” 

We indorse all of the statements made by Mr. Barnes in his testimony and 
in the statements referred to. We think the weight of authority and practical 
experience is in line with the foregoing statements and that the transshipping 
charges at Duluth on flour and on general merchandise, and in fact on all the 
commodities which could be transported on the canal, should not average to 
exceed 6 cents per ton. We agree that if railways are permitted to monopolize 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 193 


terminals there can be no freedom of water transportation, and to bring about 
conditions fair to the public there must be access to modern terminal facilities 
by all boats on like terms. Arguments are not going to produce terminals, but 
the pressure of economic necessity of reducing cost of transportation is going 
to produce terminals which will give the service suggested by Mr. Barnes and 
reduce charges to a reasonable amount per ton—say on an average of G or 7 
cents. With such terminals the canal will transport flour. We do not ask the 
United States Government to construct terminals at Duluth or St. Paul. We 
insist that it is the province of the localities as well as their duty to provide the 
proper terminals. We have seen that water transportation on the Lakes, as 
well as elsewhere in the United States and the world, may be rendered practi¬ 
cally useless without proper terminals. 

RAILWAY MONOPOLY ON GREAT LAKES. 

It appears that the railways have a monopoly of transportation upon the 
Great Lakes, with the exception of coal, iron ore, and grain; that with reference 
to grain they are rapidly acquiring a monopoly; that the public receives no 
benefit from the vast amount of general merchandise, flour, manufactured 
articles, etc., which should be carried upon the Lakes in such a manner as to 
materially reduce their cost to the consumer. The public which is deprived of 
this benefit of water transportation has borne its share of the burden of taxa¬ 
tion to provide the improvements on the Great Lakes from which they have a 
right to demand and expect a dividend by way of reduced freight rates. 

The construction of this canal, with adequate terminals, will furnish the 
necessary means of destroying the monopolistic grip of the railways, because 
it will furnish, in connection with the Great Lakes and the Erie Canal, a 
through water route from the seaboard to the cities of St. Paul and Minne¬ 
apolis and the Mississippi Itiver entirely free from railway manipulation or 
control. The construction of terminals for the canal will force the Duluth and 
Superior people to build adequate and free terminals at the Lake Superior 
terminus of the canal, because otherwise the canal and its terminals, St. Paul 
and Minneapolis, would receive freight so much cheaper than Duluth and 
Superior as to deprive the latter of commercial territory now available to it. 

ADVANCES OF LAKE AND RAIL RATES. 

We invite the attention of the general board to the statement of the lake and 
rail rate history and present situation as contained in a statement thereof 
made by the commercial bodies of St. Paul and Minneapolis filed with this 
board on June 30, 1914, and to our original argument. 

SUMMARY. 

In the original argument and this supplementary statement we have com¬ 
pletely answered and overcome all of the objections and obstacles to the 
commercial feasibility of the canal suggested or contained in the report of the 
local board, as follows: 

To the objection of the local board that the waterways and canals of the 
United States are decadent and dying out and that the fate of this canal, if 
constructed would be to lie idle and be abandoned, we have shown that the 
reason why canals have been abandoned in the past and why our great rivers 
are not carrying as much commerce as they should is due solely to the fact 
that railway interests have been permitted to obtain a monopolistic grip upon 
watenvay transportation by various methods similar in character to the 
methods employed by the great trusts and combinations in throttling competi¬ 
tors and which are now clearly recognized as unlawful and which in the future 
will not be permitted. These methods are fully set forth in our original 
argument and need not be rehearsed here. With reference to canals their 
history shows that most of those which have been abandoned were actually pur¬ 
chased, owned, or controlled by railways for a long period before they became 
useless for commercial purposes, and that in practically every instance it was 
through intentional neglect of the railway having control or arbitrary adverse 
action of such railway that the canal in question became useless and was 
abandoned. Water traffic on the rivers was destroyed by railways cutting 
rates at competitive points and recouping any losses thus made at inland non- 


H. Doc. 1008, G4—1-13 



194 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


competitive points. When this means failed the railways were permitted to 
build and operate their own boat lines in competition with independent boat 
lines and by delivering all through traffic to their own boats, forcing the inde¬ 
pendent boat lines to attempt to live on traffic originating and ending on the 
water. Then the railway boat lines cut rates on local traffic to such a point as 
to bankrupt independent boat lines. This practically drove independent water 
traffic from the rivers and canals and that condition has existed for many 
years. There being little, if any, traffic on the rivers and canals for a number 
of years, due to the conditions stated, attempts to revive waterway commerce 
find many obstacles, due to former railway control and domination, such as an 
entire absence of waterway terminals with cheap loading and unloading facil¬ 
ities, want of sidetracks, or physical connection of railways with the water 
front, ownership of water front and sites for terminals by railways. Legis¬ 
lation is necessary to compel proper cooperation between railways and water¬ 
ways, but the necessity for protective legislation and for the construction of 
the necessary terminals is now fully realized by the proponents of waterways, 
and it appears that the necessary legislation, physical connections, and termi¬ 
nals will be supplied so as to make it practicable and economical to engage in 
the business of waterway transportation upon a large scale. 

We have shown by the history of waterways and canals in Europe that 
European waterways passed through the same experience shown to exist at 
present with reference to American waterways. The result there was the same 
as here. For a great many years the waterways and canals of Europe were as 
decadent as American waterways in their darkest hour. Nevertheless, the 
Europeans by proper protective legislation, by the construction of proper chan¬ 
nels, terminals, improved facilities, motive power, boats, barges, etc., and by 
compelling proper physical connections and cooperation between railways and 
waterways have succeeded in building up a great, useful, and economical water¬ 
ways system. What has been done in Europe is practicable to do in the United 
States, and we think we have shown in our original argument not only that the 
decline in waterway traffic is due to artificial conditions and obstacles created 
and maintained by hostile railway monopoly, but that the time is immediately 
at hand when waterway transportation in the United States is about to be 
revived and take its proper place in the economy of our commercial existence. 
If the recommendations of the Committee on Merchant Marine, referred to in 
our original argument, are followed in addition to the construction of proper 
terminals, there is no doubt but what the new era of waterway transportation 
will begin in earnest. 

We have shown in our original argument that the canal rate on the pro¬ 
jected canal should not exceed an average of 2 mills per ton-mile, and we think 
we have shown that the canal rate on coal should not exceed lb mills per ton-mile. 

We have shown herein that on the exact basis used by the local board to 
ascertain the available tonnage for 1912 that in that year there was actually 
transported and available to the canal 4,200,000 tons, and reckoning on the 
natural increase of the canal territory, as shown by the figures on page 15 in 
our original argument, in the year 1920 such available tonnage would be in¬ 
creased to at least 9,000,000 tons. 

We have shown that the handling charges on coal, as found in the report 
of the local board, are almost wholly misleading and erroneous (original argu¬ 
ment, and herein). We have shown conclusively, we think, that the difference 
between canal and rail transportation of coal or other commodities involves 
but one extra handling, and the cost of such extra handling as to coal is from 
3 to 5 cents per ton and that such cost is the only extra charge except for 50 
per cent of the coal delivered in the Twin Cities there would be an exact charge 
of 5 cents per ton. We have shown that there is no deterioration in coal 
involved in the one extra handling by clamshell (original argument). These 
authorities extend from the United States Bureau of Mines to Thomas P. 
Roberts, assistant engineer, United States Engineer’s office, Pittsburgh, Pa., 
whose statement is found in the original argument. 

We have shown that the handling charges as to flour, general merchandise, 
and all other commodities, except grain, will not exceed from 5 to 7 cents per 
ton with the use of modern terminals. 

As to grain of all kinds, whereas from the report of the local board it would 
appear that elevator charges at Duluth and the Twin Cities should in all cases 
be added to the canal rate to ascertain total cost of canal transportation as 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 195 


compared with rail transportation, we have shown that all elevator charges 
on grain at Duluth must be added to the rail rate as well as to the canal rate 
and that as to practically all grain arriving at the Twin Cities, which is after¬ 
wards shipped to Duluth, the same passes through elevators, and as to such 
grain there would be an elevator charge whether shipped by rail or canal. 

We have demonstrated that the tonnage available to the canal will be 
sufficient to make it commercially feasible even under present conditions, that 
is, even without the construction of the canal the commerce between Duluth, 
Superior, and the Twin Cities increasing in the future as in the past, in 1920 
would amount to more than 9,000,000 tons. The effect of linking the commerce 
of the Mississippi with that of the Great Lakes, of opening the new Erie Canal, 
thus providing a through waterway from the Atlantic seaboard via the Great 
Lakes and the Mississippi to the Gulf of Mexico, where it connects with world 
traffic via the Panama Canal, although impossible to approximate, is a factor 
which should increase such available tonnage to an appreciable extent. This 
question is discussed at length in our original argument. 

CONCLUSION. 

From all that appears in the original argument, supplemented by what is 
herein contained, we think it is clearly demonstrated that this canal project 
is commercially feasible; that its construction will save the public more than 
$1,000,000 per annum upon the tonnage available and to be affected by the 
operation of such canal at the time when in the ordinary course of construction 
it could be completed—1920. 

Not only will the canal be commercially feasible within the rule laid down 
by the local board of engineers, but we think we have conclusively demonstrated 
herein that it is a public necessity—if for no other reason—for the effect it 
would have upon the present traffic monopoly enjoyed by the railroads who own 
all the through lines of vessels carrying freight upon the Lakes and who have 
a monopoly of all the carrying trade of the Lakes, except the trade in coal, 
iron, and grain. The construction of the canal, accompanied as it would be by 
the construction of modern terminals at Duluth and the Twin Cities, would not 
only furnish a route free from railway control between the Great Lakes and 
the Mississippi, over which the commerce of the great Northwest could be 
handled at freight rates on an average of 50 per cent less than the existing 
freight rates, but the saving on handling charges upon general merchandise, 
including flour, upon the immense volume of traffic, which would result, would 
constitute in itself an immense public benefit and become a monumental example 
of the necessity of and benefits to be derived from waterways and modern 
terminals alike. 

All of the considerations surrounding the situation from the viewpoint of 
public economy and public benefit are overwhelmingly persuasive in favor of 
the solution of the questions presented in favor of the commercial feasibility 
- of this project, and we trust this board will so determine. 

Respectfully submitted. 

Lake Superior and Mississippi River 

Canal Commission of Minnesota. 

George II. Sullivan, 

Stillwater, Minn., Counsel for Minnesota Commission, 
By A. O. Eberhardt, Governor and ex officio Chairman. 

Ira B. Mills, Secretary. 

Lake Superior and Mississippi River 

Canal Commission of Wisconsin. 

E. F. Ackley, 

Chippewa Falls, Wis., Counsel for Wisconsin Commission. 

John Chinnock, Chairman. 

E. F. Ackley, Secretary. 


196 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Hearing Before the Board of Engineers for Rivers and Harbors in Refer¬ 
ence to Waterway from Lake Superior to the Mississippi River, Under 

the Act of July 25, 1912. 

June 30, 1914 (10 a. m. to 1 p. m.). 

Col. Black, Col. Abbot, Col. Newcomer, Col. Winslow, and Maj. Kutz were 
present. 

Hon. Frederick C. Stevens, Hon. Knute Nelson, Hon. A. O. Eberhardt, Hon. 
George R. Smith, Hon. George H. Sullivan, Hon. Charles R. Davis, Mr. Frank J. 
Wattrous, Mr. F. N. Stacy, and Mr. James L. Cowles appeared before the 
board in reference to the above. 

Col. Black. Gentlemen, this is a hearing on the Lake Superior-Mississippi 
River Canal. We shall be glad to hear from you gentlemen who are present to 
address us upon'this subject. 

STATEMENT OF HON. FREDERICK C. STEVENS. 

Mr. Stevens : Mr. Chairman and gentlemen of the board, I have the honor 
to commence the proceedings this morning. 

This is an old matter, with which some of you gentlemen are familiar. It was 
initiated nearly 20 years ago, and two adverse reports have been made. It 
comes before you now on an appeal from the order of the board below refusing 
to grant a survey of the canal. The reason that we appealed from the lower 
board and asked your judgment is because we believe that the facts have not 
been sufficiently reviewed, and because new facts of very great importance 
have arisen since the previous surveys and since the decision of the board 
below. 

It has been my privilege to have a very intimate acquaintance, as Col. Abbot 
will know, with the officers of the board below, Col. Potter and Col. Sliunk, so 
that what I would say does not differ very much from their judgment and is 
based upon facts which were not before them. 

The statistics and arguments relative to the possible traffic and to the com¬ 
mercial benefits of the canal will be presented by Gov. Eberhart, of Minnesota, 
who is here representing the State of Minnesota and the State of Wisconsin. 

To show you the importance of this proposition, the legislatures of those 
two States created State commissions and made appropriations to aid in this 
investigation and in promoting this plan for a canal. Those commissions have 
been at work and will submit the result of their labors to you. The governor 
of Minnesota is here and will present the matter for that State. 

*A11 I desire now to state to you in substance is this: When you examine 
the report of the board below you will note that that board first based some of 
its conclusions upon the fact of river navigation on the Mississippi having 
diminished. We realize that river navigation on the Mississippi has diminished, 
but it is now rapidly increasing. I know that Col. Newcomer will be interested 
to know that a steamer left Pittsburgh and is now making a round trip to St. 
Paul and is chartered with freight for a return trip. This week a steamer will 
leave New Orleans for St. Paul, and is chartered, I think, sufficiently with spe¬ 
cific business for the summer. 

Last winter, in investigating the Keokuk Dam as a member of the Committee 
on Interstate and Foreign Commerce, we were told by the steamer lines that 
the reason they had not carried more freight was because they did not have 
sufficient facilities, and especially terminal facilities on the river; but now 
they are preparing terminals and are actually carrying traffic. So that when 
you read in that report of the board below that that sort of traffic has dimin¬ 
ished, it is not exactly accurate, because the railroads can not handle a large 
part of that business to-day. I think foreign nations are realizing the same 
thing. I noticed in the Sunday newspapers where the Germans are making 
large extensions to their inland canals. Those projects are going ahead, and 
we must pursue the same policy if we are to care for the tremendous traffic 
of our people in the interior. The railroads have indicated that it is impossible 
for them to continue making other extensions. That traffic must be cared for, 
and the only way to care for it is by this system of inland waterways which 
will look after that business. 

There is also objection in that report to the fact that the railroads will not 
cooperate with barge lines and steamer lines. You gentlemen are familiar with 
the provisions of the Panama bill, section 11, relative to compelling railways to 
connect and make through routes and rates and other traffic connections. Other 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 197 


legislation is now pending. The report of the Merchant Marine Committee has 
been formulated into legislation that is now pending, and the committees un¬ 
doubtedly will meet in a comparatively short time, when legislation will be 
enacted, putting in the Interstate Commerce Commission power and authority 
to compel the use of terminals. 

Because the railroads happen to own the terminals, this country is no longer 
going to allow them to monopolize them by reason of prior occupation. It is for 
a public use, and the decision of the Supreme Court a couple of weeks’ ago in 
the pipe-line cases shows that wherever property is needed for a public use, 
Congress has a right to compel the owners of the property to actually submit 
it to the public use and dictate the terms of that public use; so that when you 
read that report, please eliminate that part of the argument, because Congress 
has, or Congress will, compell the owners of these terminals to grant the public 
use of them on terms which shall be fair to the owners and for the best interests 
of the public. 

Therefore the question that is really to be presented to you, from a practical 
standpoint, is, What ought to be done as to a survey for the canal? 

Just one thing more. In considering what the cost of the canal will be, 
please remember this—and Col. Abbott, I think, will be familiar with the actual 
situation—that the St. Croix River, the boundary between Minnesota and 
Wisconsin, will form a considerable part of that canal. The river, I think, 
will be about 125 miles. A considerable part of that river is navigable now. 
It is navigable for about 50 miles above the St. Croix Dam, which is a large 
water-power dam from Minneapolis to St. Paul; and considerable power can be 
developed there by means of slack water. It can be done either by the Govern¬ 
ment itself or by individuals promoting and building dams under the right sort 
of legislation, without costing the Government a cent. If our general dam bills 
are passed—and I am very confident of something being passed to that effect in 
the very near future—you can safely count on at least 50 miles more. 

I have introduced a bill for the construction of a dam, and Representative 
Lenroot introduced another bill, as to a place just below. I know of another 
site just above mine. 

Those dams, if constructed, will cover a very great proportion of the needed 
waterways without costing the Government a cent. 

So, for those reasons, please eliminate those things from the report of the 
local engineers. 

Col. Black. I would like to ask you a question, if I may? 

Mr. Stevens. Certainly. • 

Col. Black. You touched on two or three points that are of very great in¬ 
terest to this board and come into this very thing. We have in the past year 
been again and again called upon by communities to recommend the improve¬ 
ment of rivers on the ground, purely, that by such improvement the communities 
will get the benefit of the competitive freight rates allowed by the Interstate 
Commerce Commission. There has been in no case a statement that there were 
not sufficient transportation facilities, but that simply by the expenditure by 
the Government of thousands of dollars, or whatever it may be, the communi¬ 
ties then would have the benefit of water competition, and without actually 
paying anything at all, under this arbitrary ruling of the board, they would 
•then get a lower rate. Has Congress taken that matter up at aJl? 

Mr. Stevens. Yes, sir. I think Senator Nelson and I have served on the 
committees which have had to d,o with those things for a great many years. 
As you gentlemen are aware, our general policy is this, that the general propo¬ 
sition is the reduction of rates; the equalizing of rates and discrimination as 
to rates will rest with the Interstate Commerce Commission. That as a gen¬ 
eral proposition Congress makes these improvements without actual traffic; 
and I really do not think that improvements should be projected and charged 
to the Government unless it can be fairly assumed that a reasonable amount 
of traffic will be carried over the lines. In this case the same proposition that 
I make here I advocate in other places where I have the responsibility on the 
other side of the table. 

In this case remember that there are three-quarters of a million or a million 
people at the south end of this canal who are especially dependent on cheap 
rates for moving their large volumes of heavy, coarse traffic, which will be 
explained to you. So that it is the expectation and desire and necessity, more 
than that, as will be explained to you, that the actual traffic will be moved by 
this canal for which the canal is suitable. 


198 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


As to the question of rates, of course, that is also a question of facilities. 
Those things enter into this consideration, and should be considered in connec¬ 
tion with this important matter. 

Col. Black. Senator Burton alluded to this question, but he kind of skipped 
it in that minority report, and I am very sorry. At the present time the rail¬ 
roads are complaining that their rates are insufficient to pay expenses. * 

Mr. Stevens. Yes. 

Col. Black. Where they charge a rate to a place with water competition, as, 
for example, Boston, which is calculated to meet a water rate on heavy goods 
like coal, or coarse freight, then they make a higher rate to the interior. Say 
that a man living 20 miles from Boston will pay 20 to 40 cents more a ton for 
coal passing through his town to Boston, and stops at his town, than the man 
in Boston will pay for coal that passes right through that town to Boston. In 
other words, that the freight rates do not bear any relation to the cost of 
the railroad for the services rendered, and are actuated by other things. Is 
that the average opinion? 

Mr. Stevens. No, sir. There are two statutes which indicate the policy of the 
Government and which I desire to call your attention to. First, the long-and- 
short-haul clause, as recently interpreted by the Supreme Court in its decision 
a week ago, which in a way will prevent that sort of thing unless the railroads 
can clearly show that it is necessary for them to handle some of this traffic 
competing with the water traffic at a price not lower than the intermediate 
traffic. The result will be that gradually, I think, under that decision and 
under that statute there will be a sort of a distance rate—a sort of a physical 
distance rate—put it that way—that will gradually work for the railroads; and, 
of course, if the water lines are under authority of the Interstate Commerce 
Commission, as they will he, I think, in the not far distant future, somewhat 
the same policy will be pursued there. 

The other statute is another branch of that section 11 which bears upon that 
question. In passing the interstate-commerce law twenty-odd years ago, Con¬ 
gress tried to point out the importance of the rivers and harbors in the interior 
of the country, which has to pay the bills. The import and export freight rates 
with which you are familiar have been debated for many years. Under the 
decision of the Supreme Court the Interstate Commerce Commission had a 
right to allow a railway to charge less on an import and export rate than for 
a corresponding domestic rate for the inland part of the traffic. That has been 
kept in force ever since. Congress has refused to change it. 

And, more than that, in the same section of the Panama act we passed a 
provision making that principle applicable to domestic water competition. In 
other words, if traffic lands at Duluth destined to the interior—the Dakotas, 
Minnesota, and northern Iowa, which is tributary to Duluth—the Interstate 
Commerce Commission has a right to compel the lower freight rates and the 
railroad portion of it to be lower than the corresponding domestic rate covering 
the same point. 

The point that I desire to emphasize before your board is this, that Congress, 
in these two statutes as interpreted, desires to extend the benefit of its river 
and harbor improvements to as great an area as possible over the country; that 
it ought to be diffused among the people who pay the bills; that it ought not 
to be confined to the ports alone that have the benefit of river and harbor 
improvement; and those two statutes and the decisions of the courts on them* 
tend to a further development of that same proposition and that same idea. 

Col. Black. I have not had the opportunity yet to read carefully the report 
or the reply, but I expect to do that a little later after hearing these gentlemen 
this morning; but in looking over the report I see that the Erie Canal is quoted 
a great deal, and the action on it. The Erie Canal is a waterway which, passing 
through the interior, connects large navigable bodies of the navigable waters 
of the United States. That has been constructed entirely by the State of New 
York. I wondered whether in your report you had taken that matter up as to 
the advisability or nonadvisability of this canal, which is very similar, being 
constructed by State aid. 

Mr. Stevens. State aid might be a different proposition from State construc¬ 
tion. Remember that there are two States operating here. I do not know what 
proportion is in Wisconsin, but a very considerable portion, and a considerable 
portion in Minnesota. You realize the difficulty of two States getting together 
and making an agreement for a large financial outlay? 

Col. Black. New York and New Jersey recently did it in regard to the Palli- 
sades Park. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 199 


Mr. Stevens. Oh, yes; that is a possibility. They have to make their agree¬ 
ments and they have to be ratified by Congress. It is possible, and it has been 
done in the country several times. I am not very competent to speak on that 
matter, because I do not represent the State; I represent the United States. 
But I think that if you would speak to the official representatives of Wisconsin 
and the official representatives of Minnesota they might possibly indicate a line 
of action which their States might be willing to cooperate in, at least. 

Col. Black. There is another question I want to ask. I am asking these 
questions now in order that we may be enlightened on these various points. 
The question hinges, among other things, on the cost of canal traffic. As far 
as I know, we in the United States to-day have no data whatever as to the 
cost of modern canal traffic. The State of New York is building a barge canal 
and the United States is building a number of canals. There is not to-day, as 
far as I know, with the single exception of an experiment being tried at Mobile, 
any experience whatever as to the cost of modern canal traffic under modern 
conditions. As to the State of New York, I happen to be very familiar with that, 
and they do not know at all what kind of boats, what size of boats, are going 
to be the most economical for the transmission of cargoes through the canal. 
They do not know anything at all about the cost, nor the motive power, nor the 
rate of progress. In other words, any work that is done to-day, any canal work, 
is done without a knowledge of what you are preparing for. Under those 
conditions it is almost impossible to predict what can be done; and it is a 
question in my mind, and I would be glad to have it discussed by the speakers 
here, whether under those circumstances it is not the part of wisdom to delay 
further large canal projects until some experience has been had on the canals 
that are about to be put in operation, which would enable one to say the cross 
section of the canal that is desirable, the size of the locks desired, those fea¬ 
tures being based on the economical type of boat which must be used. The 
old Erie Canal was a perfectly good canal with 5 to 6 feet of water in it, with 
perfectly good dimensions, yet it was proved that under modern conditions it 
can not compete with the railroads. We do not know to-day at all what size 
waterway is necessary, because it is the same thing with waterways as it is 
with railroads. A narrow-gauge railroad may be an utter failure, where a 
broad-gauge road will answer the purpose economically. 

So that with canals it is very difficult to say just what size of canal is the 
economical size. If you get it too small the cost of operating over it will be 
too great, and if you get it too large you have your cost of operation out of all 
proportion. We are not prepared to say as to a waterway of that character 
into the interior what is the size that ought to be used. 

I would like to have that question touched upon. It is a very important 
question, to my mind, whether the United States will go into any more of these 
large interior canal projects until we know a little bit more about this thing. 

Mr. Stevens. Of course, a survey will take some time- 

Col. Black. But a survey must be conducted with the idea of a canal of a 
given size. Do you not see? 

Mr. Stevens. Yes; but you will recall that at the suggestion of the National 
Waterways Commissions Congress made an appropriation for an experimental 
type for use on the Mississippi River. That report has just been made and is not 
yet printed, so I have not had an opportunity to examine it. This canal is 
designed to correlate with the commerce on the Mississippi River. 

Col. Black. In draft, but not in cross section. The estimates that are given 
are to my mind entirely out of the way. They would not cover anything 
at all. The estimates are not for the right size of canal. 

Mr. Stevens. I am speaking of the canal that is to use the best type of 
experimental barge that has already been provided for by Congress. They 
were to have a 6-foot depth on the Mississippi from St. Louis up to St. Paul 
and a 6-foot type of canal, so that the traffic could move freely up and down 
the canal and the river. You could get somewhat of an estimate of the cost 
and of the necessity by the river traffic- 

Col. Black. No, sir. You are quite correct about the draft; there is not 
much difficulty about that. But in order that the traffic may be carried 
cheaply, a certain size of boat must be used, the smaller size being uneconom¬ 
ical in not carrying sufficient cargo to make it pay, and the larger size being 
too large and uneconomical in the cost of carriage. In connection with draft, 
the question of beam and length comes in. Beam comes in particularly on the 
width. Your locks must be of such size that you can take in one, two, three, or 
four boats of a given size. So that beam comes in and length comes in. 




200 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Until you can determine approximately the economical size of carrier, you 
can not get the economical size of canal. 

Mr. Stevens. Will not two factors aid in determining it? First, the navi¬ 
gation that will use the canal will be distributed up and down the Mississippi 
by these experimental barges, and if it is of any value to the people in that 
valley at all, that will determine the character of traffic that can use those 
waterways to best advantage. 

Col. Black. When it has been so determined. It has not been deter¬ 
mined yet. 

Mr. Stevens. No ; but it is in a fair way to be determined. 

Col. Black. It is so far from it that in New York State there is not a canal 
boat being built to-day. They are waiting. They have a barge canal there, and 
they know the size boats that will go through it, and yet they are waiting, 
trying to find out what is the economical size. 

Mr. Stevens. Of course, my own hasty opinion is that the 6-foot channel 
is determined on the Mississippi. 

Col. Black. That is all right. That is draft. 

Mr. Stevens. That factor has been determined with regard to this canal. 

Col. Black. Yes, sir; that is right. 

Mr. Stevens. Then, with the figures fairly well in hand as to the cost of 
handling that sort of traffic in canals in Germany- 

Col. Black. They have another type of boat, entirely, under different com¬ 
petitive conditions. They do not have competition with the railroads there. 

Mr. Stevens. I was going to come to that railroad proposition in just a 
moment. I noticed a statement in the last Sunday papers that the Germans are 
extending a 6-foot type of canal with 550 or 600 ton barges from Berlin to 
Leipzig, right through the interior. Does not that determine? 

Col. Black. Not our conditions. We can not go absolutely by European 
practice in any of our work. Our conditions are different, and we have always 
had to work out our own solution of these various problems, being guided as 
far as we can by the experience there; but in every case that I know of we have 
had to change the type when we got into our territory to meet our conditions. 
We do not know to-day what the conditions are. We do not know how it is 
to be built. We will know in about four years from now a great deal more 
than we do to-day. 

Mr. Stevens. As to the railroad phase of it, that is the same matter that was 
alluded to when the railroads were asking for increased rates. We will develop 
two things: First, that there will be a certain class of freights, probably, which 
will have a slight increase. What those will be has not been determined yet 
by the commission. Services that the railroads have performed free, like 
switching and stock lines, and matters of that kind, will now be charged for, 
and that is a service that the railroads have used and have eliminated the 
waterways to a very large extent. That is the old question of service being 
performed free in the large industrial centers. That has enabled the railroads 
to do away with a considerable part of the waterway competition. That busi¬ 
ness will be built up by orders of the commission and the railroads themselves. 
That service hereafter will be charged for, and to that extent the waterways 
and the waterway traffic will have quite a decided advantage. 

Col. Black. There is no doubt that this question of transportation is the most 
vital one we have before us now. We can not reach the desired result in lower¬ 
ing the cost of living until things can be produced at the points where they can 
be produced more cheaply and transported to the points where they are needed 
the most; and that will require rail and water transportation to the utmost 
limit. They have got to be correlated and they have got to stand on the 
measure of the cost of the service rendered. The cost of each must be in pro¬ 
portion to the service rendered. 

Mr. Stevens. And must be compelled to work together. 

Col. Black. Oh, yes; they must be. 

Mr. Stevens. Now, I take pleasure in introducing Senator Nelson, who will 
now speak to you. 

STATEMENT OF HON. KNITTE NELSON. 

Senator Nelson. Mr. Chairman and gentlemen of the board, I have not come 
down here to discuss this matter with you directly, because there are other 
gentlemen here who will present the case to you more fully. 



WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 201 


Gov. Eberhart is here, and State Senator Sullivan from Stillwater, who lives 
on the line of this proposed canal. 

Before 1 state anything further I should like to leave here and file with the 
board a resolution in respect to this matter from the Minneapolis Chamber of 
Commerce. 

I want to say that my understanding of the case is that this proposition in¬ 
volves no engineering difficulties, nothing of a serious character so far as that 
is concerned. By building a canal from Lake Superior to the waters of the 
St. Croix River a large share of the St. Croix River can be canalized and used 
by means of a system of dams, as stated by Mr. Stevens. 

I call your attention to the fact, as you, Mr. Chairman, have well stated it, 
that it is practically a commercial proposition and not an engineering propo¬ 
sition. The question is whether this canal would be for the commercial ad¬ 
vantage and benefit of the people who naturally would receive the results of 
the transportation contemplated. 

If you will look at the map of Minnesota you will see that right at the end 
of this canal, as it were, or of this waterway, there are the two great cities of 
St. Paul and Minneapolis with a population of over 600,000—between six and 
seven hundred thousand; with their suburbs perhaps more. Barges could be 
taken from Lake Superior right up to the wharves of St. Paul and Minneapolis. 
The great dam between Minneapolis and St. Paul is fast nearing its completion, 
if not already completed. The result of it is that barges can be taken directly 
from Lake Superior to the docks at St. Paul and Minneapolis; so that the ques¬ 
tion of joint rates between the waterway and the railroad route does not cut 
the figure there directly with those two cities. It is only when you come to 
ship the freight into the interior that that question arises. 

In the recent decision of the Supreme Court—I do not remember the title of 
the case, but the decision was announced last Monday—the Supreme Court 
was concerned with what we commonly call the Spokane case. You know, there 
was a peculiar situation under the old interstate commerce law as it existed 
up to recent amendments. It provided that railroad companies should not 
charge more for a shorter haul than for a long haul in the same direction under 
similar circumstances and conditions. I am not quoting the language exactly. 
We eliminated the phrase “under similar circumstances and conditions” in the 
amendment to the interstate commerce act that was passed in 1910. Prior to 
that elimination the conditions were these; and I will recite this specific 
case: 

The city of Spokane—you all know where it is situated—had to pay this rate 
of freight. They charged freight, say, from St. Paul to Seattle, and then the 
freight from Seattle back to Spokane. In other words, it was based on the 
theory that the freight shipped from St. Paul to Spokane should be shipped to 
Seattle and then back to Spokane, and they charged the shipper that compound 
rate and the local rate back to Spokane. 

You can all see what a terrible burden that was, and it was all done on the 
theory that Seattle, having water competition, was entitled to those low rates, 
and the railroads had to give extraordinary low rates, really below the cost of 
service, in order to compete with the water routes. 

Under the decision in the recent case, to which I refer, and under the amend¬ 
ment that we made in 1910, the Supreme Court has lately held that they had 
a right to reduce rates, such as those Spokane rates, and they did reduce them 
and sustained that provision of the act of 1910 which eliminated the words I 
have referred to. 

In that way Congress, by that legislation, gave immense relief to people 
residing in the interior points. 

There is another point I want to call attention to, and that is this: You Will 
find that wherever water transportation and railroad transportation meet it is 
the water transportation that controls, as a rule. In other words, you will 
fincl—and I think it will be more apparent when the Panama Canal is opened 
and traffic commences there—that the rates at the Pacific ports, San Fran¬ 
cisco, Seattle, and other ports, the railroad rates, will have to conform to the 
water rates. That is on through traffic. 

Col. Black. Senator, then will they be allowed to make it up from the people 
in the interior? 

Senator Nelson. They may, to some extent; but still it does not follow 
because they must conform to those rates that the rates will be unremunerative. 
That does not follow. The one proposition does not follow from the other. 


202 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Take this case here that you have in hand regarding the question that you 
suggested a moment ago as to the cost of operating these barges. It is a 
matter of common knowledge that water transportation, wherever it has 
come in direct competition with rail transportation, has always had the effect 
of lowering rail transportation. Take the whole course of the Mississippi 
River. Since we have been improving that river, although the commerce on 
it has diminished year by year, yet the rates to points on the Mississippi River 
have been immensely lower. That is one of the great advantages that you 
never ought to overlook in the matter of water transportation. 

What is the character of the chief traffic that comes by the Lakes? It is 
what we call heavy goods—coal, salt, and other similar commodities. The coal 
is shipped up to Duluth at a very low rate, for the reason that the ore boats 
that carry iron ore down the Lakes are glad to get traffic back; but when 
that coal comes to Duluth and is distributed from that point to the interior, 
then the railroads get their work in and levy a heavy tribute. I think they 
charge about a dollar a ton; 96 cents on soft coal and $1.20 on hard coal. 

With this barge canal from Lake Superior down the St. Croix River and 
up to the docks and wharves at St. Paul and Minneapolis, you can readily see 
that under any conditions water transportation will be cheaper than that. 

Col. Black. No, sir; I can not quite see it. I would like to have you make 
it a little more clear. 

Senator Nelson. I state it on this theory. Of course, I can not go into any 
statistics with you. 

Col. Black. No, sir; I do not want any. 

Senator Nelson. I think, Mr. Chairman, that in this direction our experience 
in the past has always shown us that water transportation has tended to 
reduce rates. 

Col. Black. Yes, sir. Your opinion, Senator, has a very great weight with 
us. I have read a great many of your reports and arguments with a very 
great deal of interest, and I want to get the information now right from you. 
Here we have a case of this kind. Both rail and water transportation are 
media of transportation for the public, which ought to be availed of where 
it is cheapest. 

Senator Nelson. Yes. 

Col. Black. It costs money. In one case the ^ailroads have to put up the 
money for their own road and own it and have the measure of control over 
it and the measure of control over rates. In another case the people of the 
entire country put up the money. If it costs more when we consider the cost 
of the water route, the interest on the money and the cost of maintenance to 
transport by water from the other places, is it a proper investment? If, in 
other words, it would be cheaper for the people of the country, irrespective 
of where the money comes from, to have the rail transportation, should the 
Government then pay for an expensive water route in order to reduce that 
cost? 

Senator Nelson. Yes, it should for two reasons. In the first place, the 
people are entitled, the public are entitled to the lowest possible rate- 

Col. Black. Would they be getting it? 

Senator Nelson. I think so. In the next place, waterways, I conceive, are 
a much greater regulator of railroad rates than the Interstate Commerce Com¬ 
mission is. We have got more benefit in our State from the water rates of 
the Great Lakes than we have from the Interstate Commerce Commission. 

And I want to say further that the great benefit that the people of Minne¬ 
sota have received recently under the decision of the Minnesota railway cases, 
reducing our mileage for passengers, short or long distances, for everybody, 
and commodity rates—we have received that benefit not through the Interstate 
Commerce Commission but through our State legislation and our State railway 
commission; and that legislation was attacked, but the Supreme Court of the 
United States sustained it in a leading case announced by Mr. Justice Hughes. 

Here is another thing I want to call your attention to, and that is that the 
Interstate Commerce Commission always justifies the railroads in having low 
rates at water terminals because of the water competition. We get a lower 
rate directly by water transportation, and indirectly it affects railroad rates. 

Col. Black. Do you think that will stand for all time? 

Senator Nelson. Why, I think so. 

You spoke, Mr. Chairman, about the Erie Canal. Let me call your attention 
to this; Let us go back to the early history. What made New York the com¬ 
mercial metropolis of this country? 



WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 203 


Col. Black. Its location on the Hudson and on the Atlantic seaboard- 

Senator Nelson. No. The Erie Canal gave it a start. There was a bigger 
harbor and a better place down at Fortress Monroe and Old-Point Comfort. 
Had the waterway been built down there to the navigation of the James River 
there would have been a point for the commerce of this country. It was the 
Erie Canal, the building of the Erie Canal, that gave New York its commercial 
start and made it the commercial metropolis of this country. It is because 
New York is fearing that it may lose that vantage ground that it is expending 
millions to enlarge that canal. 

You, Mr. Chairman, know more about the details of that than I do. In view 
of the fact that the statistics show that the canal does not carry more than a 
small picayunish bit of the total freight, why are they expending millions? It 
is to hold that canal as a competitor of the railroads and enable New York to 
maintain its commercial supremacy. 

Col. Black. That is one of the factors. 

Senator Nelson. Can you account for that expenditure on any other theory? 
Can you account for it, Mr. Chairman, or any of you gentlemen, on any other 
theory than that New York seeks by means of that canal, first, to regulate 
the through rate from the Lakes over to the harbor of New York, and in the 
next place to maintain its commercial supremacy? That is at the bottom of it. 

Col. Black. That is not the only factor. There is another thing that comes 
in there very strongly, and that is the competition of the Canadian canal and 
the St. Lawrence water route. That, New York is very much afraid of. 

Senator Nelson. That competition is not so great at present because of the 
limited scope of those canals. Ocean vessels of any consequence now can come 
up no farther, I believe, than Montreal. Smaller vessels may possibly go 
through the Welland Canal, but at present there is no competition of that kind. 

When we speak about the benefit of waterway navigation as an entirety, 
look at the advantages that the Northwest has received from the improvement 
of the Soo Canal. And think what great commercial advantages we will reap 
as an entirety from the Panama Canal. It will no doubt increase the commerce 
of this country immensely; but more than all, Mr. Chairman, the tendency of 
it will be to reduce transportation rates. 

You spoke about the capital for the building of railroads being raised and 
furnished by the railroads; that they are built with their own money. In a 
measure that is true in the first instance. They raise the money, but it is the 
public at large that has to pay the interest and pay the dividends. 

Col. Black. There is no question about that. 

Senator Nelson. And pay for the maintenance and upkeep of the roads. It 
comes out of the public. 

Col. Black. There is no question about that. 

Senator Nelson. Why should these States be compelled to build this canal? 
Why, only two years ago Congress passed a bill for a canal from Norfolk back 
to one of the sounds in North Carolina, alongside of the Dismal Swamp Canal. 
You are no doubt familiar with that? 

Col. Black. I was on that board. 

Col. Abbot. So was I. 

Senator Nelson. You recall in that case, if I remember it aright, there were 
two canals, and also another route that was suggested, if I recall it rightly- 

Col. Black. You are quite right. 

Senator Nelson. We finally adopted the route that you recommended, I 
think, and we built that canal in favor of that route. I supported that meas¬ 
ure. I thought it was right; and that canal, in respect to the amount of com¬ 
merce and traffic and the commercial advantages as compared with the canal 
we are speaking for here to-day, is only a fleabite. 

Col. Black. That we want to know. 

Senator Nelson. It is only a fleabite. You look at the country. Study the 
country contiguous to the Dismal Swamp Canal. I will call it that. That is 
not the proper name of the canal, but I can not recall the correct name at this 
time. 

Col. Winslow. It is the Albemarle & Chesapeake. 

Senator Nelson. Examine the country contiguous to that canal, at its two 
termini, and you can readily see, if you consider it, that the cities of Duluth, 
St. Paul, Minneapolis, Stillwater, and the prosperous agricultural country sur¬ 
rounding that—you can see the vast difference there is between the traffic that 
would naturally inure to one canal and that which will necessarily inure to the 
other. 




204 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Col. Black. I think if you will look at that further you will find that you are 
mistaken about that. 

Senator Nelson. Well, of course we will not ship as many vegetables nor as 
many cantaloupes nor as many watermelons nor as many sweet potatoes as 
they will, but we will ship a lot of flour and a lot of coal and a lot of salt and 
a lot of other traffic-- 

Col. Black. Senator, excuse me right there. That will depend entirely on 
the cost of operation. If the cost of shipping by water is going to be markedly 
less than the cost by rail, you will do it, probably. If not, you will not. That 
is not the question that is up. How much traffic will seek it? That there is 
traffic there is no question at all. There is an enormous amount of freight 
that has to be moved from that section to another section. It is a question, 
though, how that freight shall be moved; and that is an economical question 
that comes in. If it is going to be cheaper by that route, the shipper is going 
to do it. He has no sentimental reasons about it at all. 

Senator Nelson. Have any of you members of this board known of any well- 
defined case where transportation by water has cost just as much or more than 
railroad transportation ? 

Col. Black. Yes, sir. The Illinois & Mississippi Canal has cost the Gov¬ 
ernment a great deal more. 

Senator Nelson. You mean the building of the canal? 

Col. Black. No, sir. Taking the cost now, the cost per ton-mile of freight 
carried over it; taking into consideration the cost of- 

Senator Nelson. There is no traffic at all on that canal, and the canal ought 
never to have been built. 

Col. Black. But they came before us with the same argument that we are 
hearing now. 

Senator Nelson. No, no. The conditions were entirely different from the 
conditions existing here. Here it is a question of joining with the navigation 
of the Great Lakes the head of navigation of the Mississippi River—two great 
commercial water arteries of the country. It is a different proposition from 
that. That was a simple matter, simply connecting the Illinois River with the 
Mississippi River, if I recall it rightly. Am I correct as to that? 

Col. Newcomer. That connects with the Lakes also. 

Senator Nelson. Yes; but there was no connection with the Illinois River 
and Lake Michigan. 

Col. Newcomer. Oh, yes; there was. 

Senator Nelson. There is a drainage canal leading into Chicago. I do not 
know of any other canal there. The only canal that I know of connecting 
directly the Illinois River with the Mississippi River is what we call the drain¬ 
age canal. 

Col. Newcomer. There is a canal built by the State out of proceeds of land 
sold. That canal is still in existence, but of course it is a very poor one. 

Senator Nelson. And there was no connection, really, between that and Lake 
Michigan #f any consequence. It is not a fair comparison. 

Col. Black. You asked me for one example, and I simply gave that. I did 
not say it was the same. 

Senator Nelson. I take it for granted, and I think you will agree with me in 
assuming that water transportation as a rule is cheaper than rail transportation. 
There is no doubt about that. 

Col. Black. There is no question whatever. 

Senator Nelson. What the cost of moving freight on canals will be of course 
is a question to be determined. In the Erie Canal the original transportation 
was by horses. I had the fortune, in 1849, as a 6-year-old boy, to ride the whole 
length of that canal, and I remember that our boat was pulled by two horses. 
I suppose that in the new plan of canal they will have some other motive 
power. 

Col. Black. They expect to have the motive power in the boat. There have 
been boats with their own motive power navigating the whole canal; but the 
boats were so small that they could not economically compete with the railroads. 
Its size is quite comparable to the size proposed in this canal, as I recall it. It 
did not pay. 

Senator Nelson. You know the technical term of what I would call the size? 

Col. Black. Yes; that is a question of cross section. 

Senator Nelson. That would come from having motive power on the boat as 
compared with those being pulled by horse power or mule power. 




WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 205 


Col. Black. That is a question of speed and size, both together. Those things 
come in there. 

Senator Nelson. Of course, the future will bring forth what type of boat will 
be the most profitable to use and what motive power will be the most profitable 
to be used. The two questions, both as to the size of the boat and as to the 
motive power, as you have indicated, Mr. Chairman, are to some extent still in 
the air. It is a question to be determined in the future. But for that reason, 
Mr. Chairman, we ought not to delay in this waterway improvement. The solu¬ 
tion of the question of the best type of boat and the best type of motive power 
is a solution that will inure to the benefit of (his canal, like all other canals of 
the country. You would not want us to discontinue the Dismal Swamp Canal. 
You would not want us to suspend operations on that until you determine this 
question. 

Col. Black. No, sir. Another question comes in there. There is a type of 
boat that is in use now all along on these inland waterways, and the type of 
boat in use on the Chesapeake & Albermarle Canal may not be the type of boat, 
probably, that would be used on these Illinois inland waterways, because they 
have got to navigate a great deal of open water. 

It is another question entirely. It is directly comparable to the New York 
barge canal. What is the estimated cost of this canal with the dimensions 
given? 

Col. Newcomer. About eight million. 

Col. Black. I know that is too small. I do not believe that the estimate is 
wrong, but the canal is too small in cross section. In other words, it is a 
question of investment of, say, ten and a half millions of dollars. Just how 
much it is we can not tell, because it would depend entirely on the dimensions to 
be given and on the dimensions of the lock. We do not know that to-day. That 
we will know certainly, because it will be directly comparable to' the kind of 
work done on the New York barge canals; the type of boat that is found best 
there will undoubtedly have a very strong influence in determining the type of 
boat to be used on the other. You are asking the United States to go into a 
great big investment without passing on the value of the investment, and it is 
a question whether, as a business man, inasmuch as we will certainly have 
this information in three or four years, it might not be better to defer the entire 
question until we get this information and are better prepared to answer these 
questions as to what is the economical size of the canal that is desirable. You 
see, it would make a difference of several millions of dollars. 

Senator Nelson. You can not judge it by or compare it with these other 
canals. This canal down here near the Dismal SwUmp Canal, as you have 
expressed it, a part of the water route is through open water. 

Col. Black. The greater part of it. 

Senator Nelson. Yes; a great deal of it is through sounds, and where we 
would manifestly require a different type of boat from what we would in 
this canal. Those conditions would not exist here in this canal. It would be 
a canal that would be partly a canalized river. 

Col. Black. And part of it open-river navigation and all in quiet waters. 

Senator Nelson. All in quiet waters; and you could assume this, that you 
could use the motive power there that you could use on any canal of that kind 
in the country now. Aside from that, the question, then, reduces itself to the 
cost of operation. Is there any of you who have any doubt but what the cost 
of operation of a canal, a suitable canal with suitable boats, is less than the 
operation of a railroad? 

Col. Black. No, sir; none at all; but to that question of operation must be 
added the interest charges on the investment. 

Senator Nelson. Yes. 

Col. Black. And that is what we do not know. 

Senator Nelson. No; but that is a question that we will have in all these 
canals. 

Col. Black. Yes; in all of them. 

Senator Nelson. I take it that New York will never get a return on its 
investment. 

Col. Black. As a matter of fact, New York is dissatisfied now with the canal. 
It is convinced that it should have made a canal 2 feet deeper. That would 
have added one-third more. They spent $100,000,000 without knowing what 
they wanted, and they finally got a canal that was not as economical as an 
expenditure of a little greater amount would have been. We do not want to 
make those mistakes. 


206 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Senator Nelson. No; I see. Mr. Chairman, I would like to say something 
more, and then I am through. I am a member of this “ trust busting ” com¬ 
mittee, and I shall have to return to a meeting of that committee. Gov. Eber- 
hart and Senator Sullivan and others are here and are familiar with the com¬ 
mercial side of the proposition and they will talk to you, and I invoke on their 
behalf your careful consideration and attention to everything they say. 

Col. Black. We are sorry that we can not cross-question you more, Senator. 
We like very much to get you up here. 

Senator Nelson. I have been on the Committee on Commerce and have had 
to do with every river and harbor bill that we have had for the last 18 years, 
and I have always been in favor of liberal water transportation, and, largely 
because of the fact that from our own experiences in the Northwest, we have 
found water transportation to be one of the great regulators of railway trans¬ 
portation. It is not so much because we have carried more freight by water, 
but it is because we have got cheaper railroad rates that I favor it. 

I thank you very much for listening to me. 

Col. Black. We are very glad to have had you here. 

STATEMENT OF HON. A. 0. EBERHART, GOVERNOR OF THE STATE OF 

MINNESOTA. 

Gov. Eberhart. Mr. Chairman and gentlemen of the board, I shall neces¬ 
sarily be brief, because I have to make a train out of the city within a short 
time, and I am speaking here merely on behalf of this State to show you the 
interest the State has in the development of this country and in the improve¬ 
ment of our entire Northwest in having water transportation. 

I think you all concede, and the chairman has already conceded, that in the 
development of the Northwest we have to have the cooperation of all transport 
tation facilities. Minnesota to-day is one of the two States vitally interested, 
and she has now a population of 25 to the square mile. In southern Minnesota 
and in some places in northern Minnesota she has only 10 to the square mile. 
We are getting population faster than any other State in the Union. 

When we bear in mind that that has come within a few years, it is a serious 
question, in view of the fact that it is only a question of the construction of the 
barge, to say to the people of the Northwest that they must wait for this canal 
building for three or four years more. I think it is conceded to-day that that 
thing is going to come—connecting up with the Great Lakes route and the river 
system, and the matter of going to the Pacific coast is only a question of a short 
time to come; and it is a serious matter to say to the people of Minnesota and 
Wisconsin, “ We can construct this canal, but we can not determine to-day what 
kind of a barge you want.” 

It seems to me that all of the engineering ability is here already within your 
control. We have accomplished the greatest engineering problems in the world, 
and we have the money behind us to do it. It is difficult for the States, because 
it is hard to get together. It means a great deal of delay. 

I can speak for Minnesota and say to you that Minnesota will cooperate. I 
can not pledge the State of Minnesota as to any definite financial assistance, 
but the very fact that of all the projects proposed to our legislature the only 
one recognized was this one, and it was recognized almost unanimously by the 
entire legislature, shows that she is willing to cooperate. 

I think that is true of Wisconsin, in making an appropriation to go before 
you and present the facts to you. 

I think we are all clear on this one thing—that the report on which the engi¬ 
neers’ conclusions were based was made to some extent upon a misrepresenta¬ 
tion as to the amount of freight. If you take the figures as they have used 
them and get the actual freight—as Senator Sullivan will give it to you, 
because he has time to do it—you can conclude that there will be an actual 
return on this investment of about or 4 per cent. But even supposing 
that you can not figure out the 3 per cent dividend on the investment, you can 
see that the waterway improvement will benefit the entire Northwest and will 
necessarily in the future return a dividend, and you can see that we can not 
hold it up for three or four years, because we can not figure out the actual 
return to-day. I think it is a mistake to do that. I think a lot of the improve¬ 
ments that you gentlemen have approved, as shown by your reports in connec¬ 
tion with rivers and harbors improvement, have been well and judiciously 
made; but yet if we figure them all out, how many of them can you actually 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 207 


say have brought 3£ per cent return? I think the mistake we made was that 
we did not think the new canal would have the modern loading and unloading 
facilities, and instead of figuring 25 or 30 cents a ton, it ought to figure 5 or 
10 cents a ton. 

We are getting active along the entire river—Minnesota and Wisconsin and 
all the river States are getting active in establishing loading and unloading 
facilities and municipally owned docks and wharves all along that river. Min¬ 
neapolis has already started, and so has St. Paul and all the towns south of us. 
We are going to have a uniform system. In fact, I myself and the governors 
of Illinois and Missouri have been authorized as a committee to secure engineers 
and get a report that can be adopted by all the river towns in establishing docks 
and wharves. 

We have not been benefited by the river because in the past we have not had 
loading and unloading facilities. Minnesota is immensely interested in the 
project, because when we get 100 population to the square mile it is quite an im¬ 
portant matter to us. 

As to the heavy bulk and slow freight, you turn to the water routes instead 
of to the railroads. The railroads are going to get the high-class and the fast 
freight. That will always go with the railroad. But the heavy and bulk freight, 
which constitutes a large proportion of our freight in a great industrial territory 
like Minnesota, will go by water. It appears to me that the time is soon coming 
when we must have a complete water route between the Great Lakes and the 
Gulf of Mexico, and I feel that we are not justified in holding that up for three 
or four years. The development of the entire Northwest is dependent upon 
cheap transportation by water, and the country is growing very rapidly. 

We feel that you can go ahead and approve this canal. Supposing it will cost 
$10,000,000. It is now estimated at less than $8,000,000; but supposing it is 
$10,000,000, or $12,000,000. You have determined already that the canal is 
entirely practicable from an engineering standpoint. Senator Sullivan has the 
figures to show you that a great deal more freight is handled than was esti¬ 
mated earlier. Errors can be made by everybody, and we think we have made 
errors which ought to be corrected. I believe that when these are presented to 
you, showing the enormous amount of traffic, you will not allow the question 
of construction and the type of boat required to hold the proposition up three 
or four years. 

Speaking for the State of Minnesota, I want to say that Minnesota will co¬ 
operate with the Federal Government in this question in every possible way; 
but it is a national question. The tremendous amount of freight handled will 
involve national rates entirely; but it is being constructed largely between 
Wisconsin and Minnesota. We have had many difficulties. If the Federal 
Government is justified, as I think it is, in expending money on a waterway 
improvement that means so much to the Northwest as this does, I think it ought 
to be done now and not keep us waiting three or four years more. 

You can study the geography of this country and the movement of population, 
etc., and you will find that the center of population is going westward; it is 
nearly at Minnesota. In the past Minnesota used to send her goods eastward 
and have them sent back as finished products. That time has gone by. We 
must keep on with our development. There will be a complete system of water¬ 
ways, but the first thing that we necessarily must have is this canal. And, 
speaking for Minnesota and Wisconsin, and realizing that if there are any 
engineering difficulties you can straighten them out, and realizing that it is a 
problem for the National Government rather than for the States, we are asking 
you on behalf of these States to proceed, and we take it for granted that when 
we determine what kind of a barge is needed, that the amount of traffic that 
will pass through the canal in four or five years will sustain that 3£ per cent 
dividend on the investment. While you have spent a lot of money on our river 
and have done a good work, we do not want you to say to us now that merely 
because you can not determine definitely what kind of a barge is required that 
it shall stop this progress and this advancement of the canal project. 

Col. Black. How soon would it be possible for the States of Wisconsin and 
Minnesota to state the amount of cooperation they will be willing to make? 

Gov. Eberhaet. It might take a long time, or we might do it at the next 
session. 

Col. Black. That would have a very important bearing on this question. 

Gov. Eberhaet. We are doing this now; we have already started on an in¬ 
vestigation looking to a uniform plan, and when we get that it will not take 


208 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 

long for the river to be improved. But it is no use to speak of that until we 
have some plan. 

Col. Black. That is quite right. 

Gov. Eberhart. We are working hard on that. Minneapolis is covering quite 
a lot of ground, and quite a large number of those cities to the south have 
done the same thing. So I think they have done as much as they can. If it 
is determined that the State must do this work, you can readily see how difficult 
it is for the States to get together. You have the engineering ability and you 
have the best there is. If the Federal Government undertakes the work, it is 
going to be done. We think that there are so many national problems involved 
that it is for the Federal Government to do it. Whatever capital you think the 
States ought to give—I do not think necessarily it should be along financial 
lines, but in the way of making that canal acceptable for transportation pur¬ 
poses—the States are willing to do it. 

I shall not take up any more of your time. I really feel deeply obliged to 
this board for giving us a hearing, and I am 'Sure that any action that you 
desire to be taken on the part of the State, as far as cooperation is concerned, 
will be gladly taken; but you must bear this in mind, that if you delay it and 
expect the States to take action in constructing this canal it is going to delay 
it. The legislature meets every two years, and the first thing to do is to make 
an appropriation for a survey and go over for two years, and then we might 
have difficulties and have to go over another two years. 

Mr. Sullivan will be prepared to show that the facts and figures used in the 
last report were erroneous. We are not blaming anyone for making those 
errors in there, but they are there, and we believe that the conclusions were 
based on errors, and we feel that we are not justified in letting that go through 
without giving the States of Wisconsin and Minnesota and all the Northwest a 
chance to develop as we ought to by having this canal constructed. 

STATEMENT OF HON. GEORGE R. SMITH, FIFTH CONGRESSIONAL DISTRICT 

OF MINNESOTA. 

Mr. Smith. I am a Congressman from the fifth congressional district of 
Minnesota, embracing the city of Minneapolis and the county of Hennepin, 161 
square miles, containing 400,000 people. 

Col. Winslow. How much of that is the city of Minneapolis? 

Mr. Smith. Fifty-three square miles. 

I have listened with considerable interest to what has been said with refer¬ 
ence to this project, and being a new Member of Congress I have not given it 
the thought and consideration that the other Members, like Senator Nelson 
and Congressman Stevens, have given it. It is one that requires a great deal 
of thought and consideration, and I say that I have not had the time and 
I am not going to impose upon the good nature of the board with any lengthy 
statement on this subject. 

I have prepared a few remarks that I am going to file with you, and while 
I am on my feet I wish to express the desire of the city of Minneapolis to have 
this canal built. We are very anxious to have it constructed. While I realize 
that the city of St. Paul—the “ twin ”—and Stillwater and Duluth and Superior 
and Winona will all be greatly benefited by it, and probably to the same ex¬ 
tent proportionately as Minneapolis, we feel at Minneapolis that we are spe¬ 
cially interested because of being a manufacturing center. 

Fifty years ago I was born in that city, and I remember distinctly that 
freight was being carried from St. Paul across the prairies to Warburton, Fort 
Gary, and Winnipeg by oxcarts, afterwards by cattle trains, and then by rail¬ 
road. To-day we have the great systems of railroad in our State. It was re¬ 
marked a short time ago that in the building of railroads the owners furnished 
the capital. In our State the first four railroads which were built had $27,000 
furnished by the citizens of the State itself for every mile of road that was 
built, and it only cost the builders $23,000 a mile to build it. 

Being reared in that State, as I was, I have seen its possibilities, and from 
the oxcarts to the great railroad systems that we have now has been a long 
step. However, we have filled in with a population of about 2,250,000, accord¬ 
ing to the last census; possibly it is now in the neighborhood of 2,500,000, 
which is a population in which every man is a worker, and as a result of that 
the city of Minneapolis, from a small hamlet that I can remember, is to-day a 
city of 335,000. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 209 


From the water power that has made the mills of Minneapolis the greatest 
in the world—30,000 horsepower, as I remember—we have now some four or 
five other water-power dams that produce three times as much water power 
as the old St. Anthony Falls did, and practically all that power is consumed 
in the Twin Cities. We use in the Twin Cities practically all of the power * 
that is generated by the St. Croix Dam, which is about 28,000 horsepower. 

Our rapid transit company has a dam of its own. We use all the power 
from the Coon Creek Dam in our industries. Our mills grind in the neighbor¬ 
hood of 80,000,000 bushels of wheat a year. We ship out of Minneapolis in the 
neighborhood of 18,000,000 barrels of flour a year. 

Besides having the greatest flour-milling industry in the world, we have the 
greatest flax and linseed-oil industries in the world. We are sending abroad 
great quantities of oil cake, and we are grinding the great bulk of the linseed 
oil used and manufactured in the United States. It is safe to say that in 
addition to the 100,000,000 bushels of wheat that comes into the market of 
Minneapolis we have at least 60,000,000 of coarser grains, and it is safe to 
say that 80 per cent of the wheat and the coarser grains are manufactured in 
Minneapolis. 

We are using to-day in the neighborhood of 200,000,000 tons of coal in the 
city of Minneapolis alone. That coal is being brought to us by lake-rail rate, 
30 cents from Buffalo to Duluth and 90 cents to $1.25 a ton from Duluth to 
Minneapolis. That alone will furnish a great quantity of commerce to the 
proposed canal. 

There is no doubt that as our State grows in population and in industries 
the railroads will handle the first-class freight and that the canal will handle 
the second or third class freight, or the freight that will move slower. 

We are now building at Duluth one of the greatest steel mills in the world. 
As a single plant we have the largest. We use a great quantity of steel in 
Minneapolis. We have the greatest threshing-machine manufacturing industry 
in the world. We have the greatest traction-engine manufacturing plant in the 
world. We have the greatest assemblers and reshippers of farming implements 
in the country. 

The business men of Minneapolis pledged the Mississippi River Improvement 
Association 100,000,000 tons of freight for the Mississippi River project last 
year; and at the rate at which we are increasing and the rate with which 
our whole State is growing there is no doubt that by the time this canal will 
be completed, if you start now in making your survey, Minneapolis alone will 
furnish to the canal from 1,000,000 to 3,000,000 tons of freight per annum. 

That is one of the important things that you gentlemen are considering. 
You w T ant to know whether this canal is economically feasible and you want 
to know what it will cost, and after that is ascertained you want to know how 
much freight it will carry and what will be the cost of carrying that freight. 

When you take into consideration the history of our State, its rapid develop¬ 
ment, its necessity for cheap transportation, so that the citizens of that com¬ 
munity can be put in close touch with the coal that is needed in its industries, 
the great necessity for this water transportation will be realized. That is 
one of the great drawbacks; and until we have cheaper coal our manufactur¬ 
ing industries will be retarded. Why, if we had the canal constructed and it 
could carry freight from Duluth to Minneapolis at from 50 to 60 cents a ton, 
that would bring the coal mines on Lake Erie within 100 miles of the city of 
Minneapolis. We are willing to discount that slightly, but there is a great deal 
of truth in that assertion; and the citizens of the State of Minnesota and of 
the Northwest feel that they are furnishing a large share of the revenues to 
run this Government. They feel that the citizenship that they have, the fer¬ 
tile soil that they have, the climate that they have—that with those things 
they are going to furnish a great deal more in proportion, in the future, than 
they have in the past. Nothing can stop it except just such a neglect as it 
would be to refuse to carry out this project. 

I can remember when the city of Minneapolis did not furnish $5,000 in postal 
receipts to the Government of the United States. It furnished last year 
$2,250,000 in postal receipts. While it is an inland city and has no water trans¬ 
portation, it furnished to the Government over $900,000 in customs receipts. 

To-day its citizens are expending $300,000 in building wharves and docks, 
municipally owned. It is just putting in the retaining wall and buying land. 

We expect to expend a million and a half upon our docks and upon our mod¬ 
ern means of loading and unloading commerce. We are willing to do that; and, 


H. Doc. 1008, 64-1-14 



210 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


if I understand the public questions aright, every dollar that we so invest 
enriches this whole territory and this whole country, and that we are paying 
and will pay a large share of the revenues which are turned into the United 
States Treasury. 

When these things are taken into consideration, together with the technical 
knowledge possessed by this honorable board, we feel that this board could 
with propriety make some arrangement by which the Mississippi-Lake Superior 
waterway could be undertaken, at least in a preliminary way. 

I desire to thank the board for this opportunity of coming before you and 
for listening to the remarks that I have outlined. 

STATEMENT OF MR. FRANK J. WATTROUS, REPRESENTING THE ASSOCIA¬ 
TION OF COMMERCE OF ST. PAUL AND THE COMMERCE ASSOCIATION OF 

MINNEAPOLIS. 

Mr. Wattrous. Mr. Chairman and gentlemen of the board, I want to take 
just a moment of your time. I did not know until the last moment that I was 
to represent the Twin Cities. The secretary of our association of St. Paul at 
the last moment was detained, owing to serious illness in the family, and was 
unable to come. I have not been able in the meantime to prepare anything, 
but the case will be laid before you so fully and so completely by Senator 
Sullivan that there is very little I could add, even if I wanted to. 

There are one or two matters here, though, in connection with rates between 
the head of the lakes and the Twin Cities that I want to call your especial 
attention to. I will be as brief as possible. I will only cite the first-class rates. 
The same proportion of reduction or increase applies to all the rates, so I will 
give you the first class, which will mean second, third, fourth, fifth, and sixth, 
and you will understand that the same increase or decrease applies Mike to 
all of them. This, I think, should have considerable bearing in connection with 
what Mr. Sullivan will say to you and should have considerable bearing on this 
whole matter. 

There were times prior to 18S9 when the through rate via the Lakes from 
New York and common points to the Twin Cities was the same as to Duluth. 
From 1889 to 1892 the rates to the Twin Cities were at no time more than the 
figures here given (referring to paper). The first-class rate was 5 to 1. In 
the fall of 1902 and 1904, inclusive, the Twin City rates were the following 
figures higher than Duluth: 

First-class rate, 11 cents. In 1896 the Twin City rates were 14 cents, and 
in 1891- 

Col. Winslow. Is that an increase of the rate to Minneapolis or a decrease 
of the rate to Duluth? 

Mr. Wattrous. That is an increase of the rate to Minneapolis. 

We come down to 1907. The different dates are given. In 1907 another 
advance was made in the rates effective to Chicago, 62 cents; to Duluth, 68 
cents; to the Twin Cities, 83 cents. You see the handicap we have had. 

In 1911 the Commercial Club brought an action before the Interstate Com¬ 
merce Commission against the Baltimore & Ohio Railroad et al., complaining 
of the rate to the Twin Cities discriminating against Duluth, asserting that the 
lake rates should break at the water’s edge—that is, Duluth—and that the 
local rates from Duluth to the Twin Cities should be added to the rail rate to 
Duluth. You see, we were still further handicapped. The rates from Duluth 
to the Twin Cities, local, are governed by the western classification. There 
is no sixth class in the western classification. That would mean that the rail 
and lake rate from New York common points to the Twin Cities would be $1.03 
for first class. 

This statement gives those statistics all the way through and gives each 
as a proportionate increase. I desire to leave the statement with you and I 
should like very much to have you study it over. 

There is one point that will be brought out very forcefully by Mr. Sullivan, 
but if I may be permitted just very briefly to enlarge on it before he makes 
the statement, I will say that the thought has occurred to me from the 
question that you asked Senator Nelson. 

In the last four years the increase in tonnage from the head of the Lakes 
to the Twin Cities has been in round numbers from two and one-half to very 
nearly four million, which means an increase of 63 per cent, or an average of 
about 15 per cent a year, I think it is. Assuming that the increase would 
continue for the next four years, or the next six years, we will say, up to 



WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 211 


1920, the increase would be about 120 per cent. That would mean in volume 
of tonnage alone, in coal, of something like 5,000,000 tons. 

You spoke about the railroads hauling these commodities cheaper than the 
canal, or as cheap. That is, the relative cost of handling as compared with the 
canal. Assuming that the cost is the same, or assuming that the cost is 
greater, the canal would have to he used, because it will be a physical im¬ 
possibility if this rate of growth continues to use the railroads entirely. There 
is every reason to believe that it will continue, and I think it is conservative to 
say that it will be greater; that the growth within the next six years will he 
a larger percentage than it has been in the last four years. It will take 
almost double the quantity of rails we have at the present time to handle it, 
apd it is a physical impossibility, owing to the very peculiar topography of 
St. Paul; apd Minneapolis is very little better. We can not build any more 
railroads. There is not a place for them to go. We have now got to turn to 
the river, and we are turning to it. It is our only solution. This is a problem 
that interests the entire Northwest. Our very salvation, almost, is at stake— 
our commercial supremacy. 

I do not think there is anything more that I can say, and I do not want 
to take up any more of your time and interfere with Mr. Sullivan. 

STATEMENT OF HON. GEORGE H. SULLIVAN, STATE SENATOR FROM 

MINNESOTA. 

Senator Sullivan. Mr. Chairman and gentlemen of the board, in preparing 
to present this matter to the board of engineers of course we merely under¬ 
take to discuss the questions that were discussed in the report of the local 
board; and the local board’s report assumed that the canal was, from an en¬ 
gineering standpoint, feasible in all respects. So we do not take up any ques¬ 
tions of engineering nor do we have to take up any question relating to the 
prism of the canal, the size of it. We assume that the physical features of 
the canal were approved and that it would he a 6-foot canal, 80 feet in width 
at the top and 59 feet at the bottom, as provided for in the report of the 
local board and other reports which preceded it. 

Neither do we take up the question of the type of barge, but we have under¬ 
taken to discuss the question from the standpoint of whether a barge of the 
character specified is or is not economically feasible; that is, whether there 
is tonnage enough moving between the points referred to, the Twin Cities and 
the cities of Duluth and Superior, which would be available to this canal 
and which would thereby be a saving to the public in lowered freight rates 
in the sum specified by the local board of engineers, to wit, $420,000 per an¬ 
num. So we take up the discussion upon that basis. 

First, 1 want to call your attention to section 31 of the report of the local 
hoard. In this section the local hoard says that they have the statistics of 
the Minnesota Railroad and Warehouse Commission of the total tonnage of 
hard and soft coal and flour shipped between those points during the year 
1912, and that from reliable estimates furnished by railroad authorities it ap¬ 
pears that this freight is 80 per cent of the total freight handled by the 
roads during that year. 

In that connection it appears that the local hoard has undertaken to de¬ 
termine the question of tonnage available to this canal solely on the basis 
of the shipments of 1912, together with such addition to those shipments as 
the local board estimated would be furnished by the territory served by the 
canal and not served by the railways at the present time. We respectfully 
submit that the year 1912 ought not to be the measure, but that the measure 
should be an estimate of the tonnage which will be available between those 
points at the time when the canal may he completed in the ordinary course 
of the work which would he proposed six years from date. 

The board accepted the railway estimate that this tonnage of coal and flour 
was 80 per cent of the total tonnage nioving in the year 1912. That would 
mean that the total tonnage would he 2.722,171 tons. 

We have also secured a certificate of the actual tonnage moved between the 
Twin Cities and the Duluth ports for the years 1909 to 1913, inclusive. You 
will find this table on page 15 of our statement. It appears by this state¬ 
ment and the facts are that the actual tonnage in 1912 was 3,484,000 tons 
instead of the amount necessarily found by the local board—2,722,171 tons. 

This error of the local hoard we do not charge against the local board at 
all nor do we charge the local board with the responsibility for these errors 


212 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


if we find any in their work. They are due to the statements made to the 
local board by the railways. We have the absolute fact on that proposition. 

You will find in section 37 of the report of the local board that they add to 
the actual tonnage shipped in 1912 a certain amount to take care of the en¬ 
larged territory. Twenty and three-tenths per cent is the figure they have 
used. By using that figure they increased the actual tonnage which would be 
said to move on this canal during the year 1912 from 2,722,171 tons to 3,295,000 
tons, allowing for the consumption of the territory that the canal would serve. 

By adding the same per cent used by the local board to the actual shipment 
that we found actually did go there, we find that the actual tonnage which 
would be served by this canal for the year 1912 would be 4,191,000 tons. By 
referring to this table at page 15 we find that the actual shipment between the 
twin cities and Duluth and Superior have increased at the rate of more than 
15 per cent per annum for five years. It is only fair to conclude that the rate 
of increase will continue. If it does continue until 1920, which I presume is 
the earliest date that we can figure for the completion of this canal, we will 
find a tonnage of over 9,000,000 tons to be actually hauled if there were no new 
factors, if you do not credit the canal with one pound of freight from the new 
steql mill at Duluth. That new steel mill will have as an adjunct 1,000,000 
tons of cement, in addition to all the steel that it will manufacture. That, 
however, is its first unit. It will start with the manufacture of 1,000,000 tons 
of cement annually. The nearest and the best market for the cement will be 
St. Paul, Minneapolis, and the territory served by those cities. 

It is only fair to assume that before this canal will be built that unit will 
probably be increased. It is only fair to assume that the linking of these 
waterways, the Great Lakes and the Mississippi, will furnish tonnage to this 
canal from various sources which will increase the tonnage over and above the 
9,000.000 which we can almost prove is available to this canal. I have made 
computations on the basis of the actual tonnage moving in 1912—4,191,000. 
Dividing the tonnage as it is divided by the local board—that is, 72 per cent— 
using the same percentage used by the local board of 52 per cent for soft coal 
and 20 per cent for hard coal, and the percentages given in section 41, found 
on page 10 of the report of the local board, and working out the rates and all 
of the cost of handling, we find that by that computation, taking the figures of 
the local board, it will produce a saving to the public in excess of $420,000 
a year. That computation is not found in the printed statement here, but it 
will be submitted to this board in the form of a supplemental statement, 
printed, so that it will be available to you in better form than it could other¬ 
wise be made available. 

So we believe that as to the question of availability we have met the require¬ 
ments of the local board, and we feel that we can demonstrate that this canal 
will be available to that tonnage, and that there will be more than three times 
as much available tonnage at the time of its completion as is stated by the local 
board. Of course, they based their estimates entirely upon 1912, and we think 
the estimate should be based on the year 1920, when the canal will be finished. 

That brings up, of course, a question that was brought up here in this hearing 
heretofore, which involved the rate at which coal, flour, wheat, and other com¬ 
modities will move on this canal. The local board made a comparison to obtain 
the rate on the Erie Canal, and they found that we could probably move mer¬ 
chandise on this canal at what we call the Erie rate—a rate of 3 mills per ton- 
mile. We believe that a comparison of the Erie Canal under tlie.conditions that 
obtain on the Erie Canal during the time the comparison was made is not a 
favorable comparison. We believe that it is entirely unfavorable to this partic¬ 
ular canal project; because, during the time of the Erie Canal they were using 
an obsolete type of boats, and the canal was falling into neglect. It did not have 
a uniform depth. No one could foretell the future of the canal. It appeared to 
be put out of business by the railway companies. The railways had control of it. 
They diverted all through freight from it until—there being nothing but an indi¬ 
vidual ownership of canal boats, each captain owning his own boat—there was 
no incentive for the man to improve the type of his boat. There was no incentive 
for a man to put on a canal boat of a modern type, a self-propelling canal boat. 
There was no handling facilities. The terminals were owned by the railroads; 
and so we say for those reasons that the Erie Canal rate should be very much 
discounted on this project. 

We feel that the rates on the Erie Canal, according to the authorities we have 
in our pamphlet here, should not be as high as 3 mills per ton per mile, but should 
rather average 2 mills per ton per mile. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 213 


On page G8 of our statement we call attention to the statement of various 
authorities on the Erie Canal rate. Hon. A. Barton Hepburn, former Comptrol¬ 
ler of Currency, on page 104 of “Artificial waterways and commercial advance¬ 
ment,” publishes the average New York canal and railway rates for a 15-year 
period, 1893-1907, inclusive, as follows: 1893 to 1897, 2 mills; 1898 to 1902, 1.9 
mills; 1903 to 1907, 2 mills. 

While the railway rate during those years ran about three times that much. 

In the report of the United States Bureau of Railway Economics, the Erie 
Canal rate is quoted as 2 mills per ton per mile. That is for the year 1911. 

The United States Inland Waterways Commission, the Government report 
of 1908, page 238, quotes the rate varying from 11 mills to 21 mills per ton per 
mile and on an average for 10 years of 2.14 mills per ton per mile. 

And so on page 70 and other pages of this report, which I will not take up 
your time to read because you will have them before you, the Erie Canal rate 
apparently is held by authorities to have been during this period about 2 mills 
per ton per mile. 

We believe that with a canal properly constructed, with a proper type of 
canal boat, with proper loading and unloading facilities at each end, proper 
terminal facilities, so that the commodities can be handled at the very lowest 
charge possible with modern practice, we can make a rate on this canal of 2 
mills per ton per mile, or possibly we can make a rate of mills per ton 
per mile. 

Perhaps the largest portion of the report of the local board is taken up in a 
discussion of the obstacles to commerce upon this particular canal. Perhaps 
the greatest obstacle found by the local board consists of the question of the 
handling charges of goods that are transported on the canal. For instance, as 
to coal, they say that coal comes to the head of the lake at a very low rate—30 
cents a ton from Lake Erie points; that it is unloaded upon the docks and from 
there to railway cars. They say that we can take coal from the lake carriers 
and place it upon a canal barge for about the same cost as it is now to put it upon 
the car at Duluth. Then they say that after we get our canal barge to St. Paul 
it will cost us 25 cents a ton to unload the coal and place it upon the dock, and 
that then it will cost 25 cents in deterioration of that coal because of the han¬ 
dling from the barge to the dock and railway car. Then they say it will cost 
us 25 cents a ton more to deliver that coal to the carload consumer. 

So they charge the canal with a rate of 78 cents and 25 cents a ton for 
handling from the barge to the railway car or dock and 25 cents for delivery 
and 25 cents for deterioration of the coal; and adding those charges to the canal 
rate of 78 cents they find that we can transport cool at only a cost of $1.58, 
whereas the present rate, they say, is 90 cents a ton on coal. 

Right in that connection I want to call the attention of the board to a vital 
and pertinent fact, which is not only of weight in the connection in which I 
am about to cite it, but it is important as one of the greatest factors in the in¬ 
dustrial situation of these United States to-day. That is that since the report 
of the local board was made the rate on railways for transportation of soft 
coal has gone up from 90 cents to 96 cents a ton. That is an item that is 
costing us who come here before you more than $120,000 every year—that one 
item where they have raised the price of the transportation of coal by rail 
between these points since the report of the local board. But they compare it, 
in the local board report, with a 90-cent rate, and so they say: 

“ You have lost 68 cents on every ton of .coal you transport, and therefore 
you can not transport coal.” 

It would be almost unnecessary to make the statement to this general board of 
Army engineers that coal can be transported from barge to dock by modern coal 
transportation methods of elevation for 3 cents a ton, because there is no 
respectable authority to the contrary in this country. Our statement here con¬ 
tains authorities from all over the country. We point out the kind and the 
character of the machinery by which it is done; and it is done in large 
quantities. The only place that we have been able to find where they have a 
larger charge for handling coal—something that can be said to sustain the 
position of the local board with respect to that—was a place in Cincinnati 
where they were only loading about 35,000 tons per annum. Of course, you 
have got to have a large tonnage in order to secure this price which the Duluth 
docks at the very hour the report was written were transporting coal for— 
from Lake Erie to their docks—3 cents a ton. That statement is contained in 
one of the appendices attached to the report of the local board. They are 


214 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


handling coal on the Monongahela and they are handling coal at Norfolk and 
on the Great Lakes at prices that run as low as a quarter of a cent per ton. 

Col. Winslow. Down at Norfolk they do not raise coal; they simply dump 
it into the ship, and down it goes. There is a great difference. 

Senator Sullivan. I do not think that increases the price very much; and 
you would not have to load the coal excepting at Minneapolis. If the coal¬ 
handling people will put in the machinery to handle that coal we can handle it 
at Minneapolis for 4 or 5 cents a ton. 

Col. Winslow. The only reason that I suggested that is that you mentioned 
Norfolk; and at Norfolk the cars run up and dump it into the boat. 

Senator Sullivan. That is very true. But at this very point—and I do not 
intend to take up the time of this board upon that question, except to call to 
your attention that proposition, because all of the data is so very fully set 
forth in this pamphlet that I do not think it is necessary to consume the time 
of the board any further upon that proposition. 

I want to say in the first place that I entirely disagree with the method of 
the local board in our handling of coal on the canal. I do not care to have 
them cancel off the cost of unloading their coal on the dock at Duluth with 
the cost of loading our coal into the barge. We prefer to charge that to the 
canal coal to start with, because when we get that done for from 3 to 5 cents 
a ton, then our coal starts out, and when it lies at the dock in St. Paul it is in 
identically the same situation as the coal transported by railway before it is 
taken off the lake carrier at Duluth. So we start under identically the same 
condition, except that we start with our coal with the handicap of 5 cents a ton 
at the very outset. The coal that is transported by rail from Duluth to-day 
must, every ounce of it, go through identically the same process and be elevated 
and taken in railroad cars and screened and shoveled and handled and sold 
exactly as our coal will be at St. Paul; and I do not know of one single act or 
one single process or one single thing that is done with coal in its transporta¬ 
tion and marketing by way of rail to St. Paul that is not identical with what we 
will have to do with our coal when we get it at St. Paul. 

Maj. Kutz. Will not a lot of it be delivered direct to the consumer if it goes 
by rail? 

Senator Sullivan. Some of it will be delivered direct to the consumer, to 
those consumers who have the side tracks. There will be a small percentage of 
them who will have to pay a charge of 5 cents per ton for that coal which we 
deliver in that manner—a switching charge of $2 a car, or 5 cents per ton. At 
the greatest estimate that can be made on that proposition it would not take 
more than half of the coal; that is, not more than one-half of the coal would 
be delivered in that manner. So that 5 cents a ton would be the very extreme 
outside cost of unloading our coal from the lake carrier to the barge. We would 
have to pay another cents per ton on the whole of it. 

If we have a rate of 75 cents, the 3-mill rate stated by the local board, based 
on the accurate distance—it is only 250 miles in length instead of 260—we 
would have to add 7+ cents, and that would give us 82* cents, and that would 
give us 13* cents a ton on soft coal. It would cost 37i cents a ton on soft and 
on hard coal, and if you will take the tonnage on hard coal and soft coal and 
multiply the number of tons by this rate and this specific mileage we would 
come within the $420,000 saving required by the local board, to say nothing 
about other things. 

Col. Black. Do you think that the United States ought to contribute the 
entire saving? 

Senator Sullivan. I am only meeting the statement by the local board. 

Let me say one word upon that specific proposition. I believe that the water¬ 
way policy of this country has been of inestimable benefit to the country. I 
believe that the one hundred millions and more that have been spent on the 
Great Lakes have been of the utmost advantage to the people of this country. 
But is there a member of this board, is there any man anywhere, who will 
contend for the proposition that it is to the advantage of the Great Lakes alone 
and the fringe of cities around the Great Lakes that that benefit must come? 
I think not. I can demonstrate—absolutely demonstrate—to this board that 
the advantage of the $100,000,000 spent on the Great Lakes stops before it 
gets to the city of Minneapolis, on general merchandise, on sugar, on flour, on 
all those great commodities making up general merchandise that come by rail. 
That was not the case formerly. Before the year 1890 they did not go by rail; 
they came from the Great Lakes. They do not come that way to-day. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 215 


I want to call the attention of this board to the fact, among other things, 
that this report of the local board is stated by the local board to have been 
made upon the faith and strength of statements made to the local board, in 
part, at least, by Julius Barnes, of Duluth, and by Messrs. Lindly & Hall, of 
Superior and Duluth. Then I ask the general board to look at the testimony 
of Julius Barnes. He was heard by the local board at Duluth on the 15tli 
day of January, 1913. On the 27th day of January, 1913, he was called before 
the Committee of the House on Merchant Marine and he made a statement and 
he testified before that House committee. I want to submit to this board 
the testimony of Mr. Barnes and his written statement, found in volume 2, 
pages 839-SG3, inclusive, as the best argument that can possibly be given by 
anyone in favor of the construction of this canal from Lake Superior to the 
Mississippi River, so as to extend to those great cities and to the great country 
back of them to which they are tributary and to which the products that come 
over the Great Lakes are naturally distributed, and see whether this canal 
ought not to be built so as to grant unto that great people and to the great 
metropolises the benefit of this $100,000,000 that has already been spent by the 
United States Government on that canal. 

What is the difficulty? The difficulty is this: All of the boats on the Great 
Lakes are owned by the railways. They were not so owned before 1890, and 
when they were not so owned it was a free field, and the United States came 
along to control that interstate commerce. But the difficulty does not lie just 
there. The difficulty lies in this, that whereas on the Great Lakes there is, 
in reference to the handling of coal, iron ore, and grain, the most modern 
facilities known on earth for the handling of those commodities cheaply and 
expeditiously—Mr. Barnes testified that one elevator has a record of loading 
1,125,000 bushels of grain in 10 hours. That elevator earned $12,000 that 
day—$1,000 an hour. 

Another record of loading was 9,000 or 10,000 tons of ore in a very few 
minutes. I do not want to quote the time, because it might seem too short— 
25 minutes. But Mr. Barnes points out in that testimony conclusively that 
there has not been one single improvement in the transportation of goods from 
boat to rail or from rail to boat on the Great Lakes in 40 years; that the work 
is done by hand, by the old gangplank methods. Why? Because the railroads 
own the boats. The railroads will not put in the facilities, and no individual 
will put in the facilities. 

Mr. Barnes came before the committee of the House and said: 

“ I want to propose a remedy. I want to propose a startling remedy. You 
can not agree with me at first, but I think the more you study the proposition 
the better you will agree with me.” 

He said that the city of Duluth is a city of only 80,000 people and can not 
afford to put in these facilities. We can not afford to build these docks and 
wharves. The railroads own our water front. We say to this general board 
that if we could get the benefit that Duluth has got, some little measure of the 
benefit of this $100,000,000 that has been spent of Uncle Sam’s money on the 
Great Lakes by the building of this canal, we will build a terminal on the end 
of this canal which will permit that commerce to grow and to expand in the 
future, from St. Paul to the sea, so that no hostile control can touch it. Be¬ 
cause it is the control of the terminals by the railroads that stops the water¬ 
ways from getting the freight. 

These handling charges we spoke of are so great that Mr. Barnes admits that 
if those handling charges were reduced to what they should be it would result 
in the saving of 20 cents per barrel upon every one of these 18,000,000 barrels 
shipped. Twenty cents a barrel! I believe that would go some little distance 
toward reducing the cost of living. That is a matter that would be absolutely 
and immediately stopped. That would be effected by the building of this canal. 
That is the proposition that we pledge ourselves to do—to put the most modern 
handling facilities upon both ends of this canal. The railroads will never 
touch it. It will go on the Great Lakes. There will be a chance then for an 
independent boat line, because they can transship that flour to the Erie Canal. 

You see that there is coming an era when all of this railway throttling of 
waterways has got to stop. You see that the attention of the people of this 
Nation is focused upon this question of waterways because of the fact that 
New York is spending $130,000,000 upon the Erie Canal and the United States 
Government is just completing the expenditure of $375,000,000 more. Everybody 
knows that knows anything about the Erie Canal that it has been owned and 
controlled, as far as operations were concerned, by railroads. Does anybody 


216 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


believe that the people of New York will permit that canal, after they have 
spent $130,000,000 upon it, to go into the hands of that hostile control again? 
That is the reason, as I understand, why New York is spending $19,000,000 for 
terminals; and that is the reason why the board of engineers reported to the 
New York Legislature that they ought to have a public traffic department for 
the Erie Canal. They said, “ What is the use of building merely a canal? Why, 
suppose a railroad were to consist of nothing but two steel rails, and anybody 
could put a car on it?” 

That is the same thing as has been the case with the Erie Canal. Any man 
could put a boat on it. There were no rates; every boatman made his rate by 
bargain. They said, “ The best railroad that was ever built in the world would 
fail under those circumstances. What you need on a canal in this country is a 
traffic department.” 

And they cited the case of the Manchester Canal and how they have oper¬ 
ated so successfully with a traffic department in handling the freight. You 
have got to have something to correlate and to unite and to coordinate units. 
To my mind one of the things that is responsible for the decadence of waterway 
traffic is just that very thing. 

The Engineer Department of the United States has done its share. They 
have made and provided the engineers, and the United States Government 
has provided everything necessary in the way of improvement; but when there 
is a great big railroad, like the Burlington Railway, up against one man own¬ 
ing a steamboat it is a good deal like a battleship striking an eggshell. How in 
the world is one little bit of a steamship going to get up against a large corpo¬ 
ration reaching thousands of points not reached on the waterway? 

I think it is wrong to permit a railroad to cut its rates along the water and 
leave the other places alone—to permit higher rates to the points not touched 
by water and having low rates to the water points. That sort of thing has got 
to be cleared out of our system before waterways can be expected to develop. 
There is not any middle ground upon that proposition at all. What is there 
fair about a rate from St. Louis to St. Paul of a certain amount and just twice 
that much from St. Louis to Rochester because Rochester is not upon a water¬ 
way? We know that is the condition on the Mississippi River waterway. 

Col. Black. Senator, you have been touching upon a certain course that I 
would like to get a little more enlightenment on. You have given us the total 
freight movement between Minneapolis and St. Paul and Duluth. During how 
many months per annum could a canal be operated? 

Senator Sullivan. About six months. 

Col. Black. What proportion of the total annual freight movement could be 
expected during that time? 

Senator Sullivan. That depends exactly upon the proposition I have just 
ceased talking about. If our rate policy is going to permit a railway to under¬ 
cut that canal, that is one proposition. If the railway is going to be required 
to make its rates upon a fair basis, why, it will affect the movement alto¬ 
gether. Don’t you see? 

Col. Black. No. I think there are other questions that come in there. For 
example, you take the coal handled. Coal could be stored without any particu¬ 
lar deterioration, as we know. It is quite possible to move all the coal in the 
summer time to be used through the year if you have terminal facilities. 

Senator Sullivan. That is very true. 

Col. Black. On the Hudson River they have very good water facilities be¬ 
tween Troy and New York. The cost of movement to New York by water is 
very much less than by rail, and the time for the movement by water is two to 
three days less than the time between Troy and New York by rail; but through 
six months of the year there is no water transportation. The railroads say to 
these manufacturers, if you will give me your business for the entire year your 
rate will be thus and so. If you will give me your business only for the winter 
months, your rates will be thus and so; and the water is not used. 

Senator Sullivan. Exactly. That question is very thoroughly discussed in 
the report of the Merchant Marine Committee. They have enumerated, I think, 
about 50 towns in which that obtains, and that is one of them. They threaten 
to give them no service- 

Col. Black. It is not a question of threats; it is a question of doing. 

Senator Sullivan. On this particular canal I see no reason in the world why 
the coal should not all move down to St. Paul and Minneapolis during the 
summer months. 

Col. Black. How about your flour? 



WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 217 

Senator Sullivan. Our flour—you know, they make flour every day in the 
year. J J 

Col. Black. I know it. That is just it. 

Senator Sullivan. I suppose that unless the railways reduce their rates to 
• the water rates, we would ship most of our flour during the summer. 

Gol. Newcomer. How about the storage? Could they stand the amount of 
capital tied up? 

Senator Sullivan. Those things would accommodate themselves. 

Col. Black. It is discussed in here, and we do not want to take up time. We 
are nearly an hour overtime. We want to take as little time as possible. We 
want only the vital facts. That is all we want. 

Senator Sullivan. At the present time the railroads carry all the flour, be¬ 
cause it costs, according to your local board, 22 cents to take it from the rail¬ 
road and put it on the boat. But Julius Barnes’s testimony is that it costs 
all the way from 20 to 60 cents. That is the reason it does not go that way. 
We would have to fix our handling charges in such a way that we could 
properly handle it, or of course we could only move flour during six months 
ol the year. But I think we would move all that flour down to Lake ports 
during that season of the year. Of course there would have to be a storage 
somewhere during the six months or else the railroads would have to carry 
part of the flour. 

Col. Winslow. Lake transportation is only open about six months of the 
year, is it not? 

Senator Sullivan. Yes; I say that. As to the other six months during which 
the canal was not in operation, I say the flour would either have to be stored 
or would go forward by rail. 

As to what policy the railroads would adopt there, I can not say. They 
might adopt a rate—of course, you know, they can not change their rate; 
they can not raise their rate. They have to maintain a rate if they once put 
in a rate. They can not raise them merely upon the ground of water com¬ 
petition. So that would be largely a question of what policy the railroads 
would undertake; and I suppose they would undertake to have the most usual 
policy. If they did, why the amount of flour that would be stored up in Minne¬ 
apolis and other points—Duluth, for instance—waiting for the summer move¬ 
ment would grow greater, and the proportion sent by rail would grow less 
until perhaps there might be some arrangement worked out of it whereby 
we would carry 60 or 80 or 90 per cent of it. 

That is a pretty hard question to answer, Mr. Chairman. I have just given 
you my best notion about it. I think perhaps the general board are more 
competent to figure that out than any of us. Are there any other questions, 
Mr. Chairman? 

Col. Black. No; I think not. 

Senator Sullivan. I want to call your attention again to this matter of 
the lake and rail rate. Mr. Wattrous called the board’s attention to it. I 
want to call the board’s attention to it because of its corroborating the state¬ 
ments made by Mr. Barnes. 

What is, first, the known history of Great Lakes transportation? The find¬ 
ing of this committee sets forth the situation very fully, and it is referred 
to in our pamphlet; but in reference to the lake and rail rate between New 
York and the Twin Cities, there was a time prior to 1889 when that lake 
and rail rate was the same to the Twin Cities as to Duluth. Then the history 
is that that rate, lake and rail, has been increasing year by year from 1890 
to the present time. In 1892 it was 11 cents, and it went up to 14 cents 
in 1896, and then from 1897 to 1901, and successively it has advanced until the 
differential between Duluth and the Twin Cities has run from 16 to 21 cents. 
But during all of that time the point I want to make is that the raises were 
occasioned not by raising rail rates but by raising the water rate, and the 
raising has continued every year since that time, when it is found by this 
Committee on Merchant Marine that the Great Lakes transportation has been 
controlled and owned by the railways. . 

So we say that by this insidious process the railways, by owning the boat 
lines and by refusing to put in terminal facilities, have robbed us of the bene¬ 
fits which we would otherwise get from the $100,000,000 that has already been 
spent by Uncle Sam on these waterways. If there were no other reason why 
this board, it seems to me, should undertake a final survey of this canal, I 
think it should so undertake it as a notice to the railways that that sort of a 
practice can not be longer tolerated. 


218 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


Col. Black. There is one other thing I want to invite your attention to. I 
suppose you saw that minority report of Senator Burton on the present rivers 
and harbors bill? 

Senator Sullivan. No, sir. My attention was not called to that. 

Col. Black. When you see it you will see that where an improvement is 
shown to be mainly or largely for the benefit of a community, Congress, in many 
cases, deems it wise that a proportionate share of the expenses of the improve¬ 
ment should be borne by that community. That is cooperation, and in many 
cases that has been insisted upon by Congress. I only want to invite your 
attention to it, because in this case there is, as I understand, no offer whatever 
of local cooperation excepting that made this morning. 

Senator Sullivan. I call the attention of the board to this—it is the language 
of our statement: 

“ Finally, we desire to add that the report of the local board should not be 
concurred in, but the same should be modified or set aside and the project 
recommended as commercially feasible. That if the general board shall deem 
it advisable to recommend the proposed canal upon condition that the localities 
and States interested provide proper terminals and proper facilities open to all 
upon equal terms, subject to public control and free from railway or other 
monopolistic control so as to insure such fair treatment of canal commerce as 
may be within the power of the States and localities interested, such conditions 
will be cheerfully accepted and complied with.” 

Col. Black. That is required by law now. 

Senator Sullivan (continuing reading). “In consideration of this project, if 
the general board should find there are any other conditions subject to which 
the project can be recommended, such conditions will be accepted and per¬ 
formed by the States or localities interested, if possible.” 

Of course, that is a very general statement. I do not know whether that is 
the first proffer—the proposition that the locality should pay part of the cost. 

Col. Black. Oh, no; that has been insisted upon by Congress in a great 
many cases. 

Senator Sullivan. I am free to say that I believe the locality is interested; 
that is, the States of Minnesota and Wisconsin would make a very strenuous 
endeavor to meet the conditions of that character that might be thought proper 
to be imposed. Of course, as said by Senator Nelson this morning, and Con¬ 
gressman Stevens, there are difficulties in this proposition that are not always 
found in others. It is almost wholly an interstate proposition. It is an im¬ 
provement of the boundary line until you get away beyond Taylors Falls, and 
then there is one portion that runs across the northwestern part of the State 
of Wisconsin and runs through to the Great Lakes. Of course, so far as that 
portion of this waterway that runs between Prescott and the Minnesota-Wis- 
consin boundary line is concerned, where the St. Croix turns to the right on 
that boundary line, that is practically a continuation of the St. Croix River. 
It has already been approved, and that part lying between Minneapolis and 
Prescott has already been very largely improved by the Government. As I 
said, I have no doubt that the benefits that this territory would receive would 
be so large that there ought to be and there undoubtedly would be a coopera¬ 
tion in the matter of cost. I do not think there is any question about that. 

Col. Black. That is all I wanted to ask you. 

Senator Sullivan. As I understand it, the report of the board is necessary 
upon this project in order to release an appropriation that has already been 
made, if I understand it correctly, for the final survey; and I know that indi¬ 
vidual citizens of Minnesota are interested enough in the project so that I 
think if the board deemed it wise to make this final survey they would con¬ 
tribute quite a large sum toward the cost of so doing. 

Col. Black. In many cases those final surveys have been ordered, Senator, 
only after the offer of local cooperation in the final cost have been made. That 
has been a factor in very many instances in recommending the survey, even. 

Senator Sullivan. We would not only be willing to cooperate in the cost of 
the project, but I believe that we would be willing to bear a part of the expense 
of the final survey. 

No other questions occur to me to be discussed here, unless there are further 
questions on the part of the general board. So far as the type of barge is 
concerned, we have offers from the man who designed the barges for the 
Alabama and Mobile- 

Col. Black. They could not run through this canal. 



WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RTYER. 219 


Senator Sullivan. No ; but he has taken the question up, and he has figured 
on a type of barge for this canal which, he says, would hold 500 to GOO tons. 
He says that he will guarantee that we can haul coal at 25 cents a ton. 

Col. Black. There have been a great many statements made that have not 
been proved yet. So we have to take his guarantee with a grain of salt. What 
is the size of that 500-ton barge? 

Senator Sullivan. He did not give the dimensions of it. 

Col. Black. That is of vital importance. 

Senator Sullivan. This is the same man who was sending a man to St. 
Paul- 

Col. Black. Those barges are good, but they have not done entirely what 
they wanted them to. They are beginning to, but they have not yet. 

Senator Sullivan. He got his cost down for handling coal to 3 cents. 

Col. Black. Has he carried any coal yet? 

Senator Sullivan. Yes. According to his statement here—I have his state¬ 
ment with me, in the Engineering News- 

Col. Black. We have that here on file. 

Senator Sullivan. And I have quoted some from his letter. I notice, also, a 
very enlightening thing and a very refreshing thing that happened the other 
day. As I understand' it, the Interstate Commerce Commission refused to 
grant an application by a railway to be permitted to make lower rates between 
Pittsburgh and Memphis on lumber without cutting the rates to points between. 
That authority was denied. And so I think that the signs of the coming of the 
dawn of the new era when waterways will be given a little chance for life is at 
hand, and the railways will be compelled to live upon freight which will 
render compensatory rates. 

As I understand it, in Germany and France they do not allow a railway 
to undercut a waterway rate. They give a differential below which the rail¬ 
way company can not go. 

I do not see any reason—of course, that is not within the jurisdiction of 
this board—but I can not understand any reason on earth why any law will 
permit a railway company to haul freight to any points in the world at lower 
than the cost of transportation, and then permit that railway company to 
charge a higher rate to other places, so that its total returns will be adequate 
to pay the investment made by the owners of its securities. 

Col. Black. You noticed how Senator Nelson this morning did not answer 
my question on that point? 

Senator Sullivan. I do not know. I would like to have pinned him down 
on that a little bit, myself; but I know my answer on that proposition is that 
it is a discrimination of the most violent kind. 

Gentlemen, I do not want to bore you and take up your time. I have some 
notions about these things. I want to file a supplementary statement, because 
I find that in looking over this statement I was somewhat in error on some 
propositions—that is, I was in error as to exactly what was in the mind of 
the local board. It would appear in the statement of the local board that, for 
instance, the rail transportation of wheat included the elevation charges, but 
that does not mean that the man who transports wheat from St. Paul has got 
to pay his own elevation charges at Minneapolis and Duluth. Those elevator 
charges are no greater for one than the other, except in the case of the canal, 
and he would have perhaps to pay the cost of transferring from the elevator to 
the barge, unless the grain was already in the elevator. If the grain came in in 
a car that could go through without taking the wheat out and putting it into 
elevator, there would be an advantage to the railway transportation in that 
one elevator charge, but wherever wheat arrives at Duluth to be trans¬ 
ferred— 

Col. Abbot. Pardon me, but is not wheat generally carried out of the car 
and after having gone some distance put into the elevator for handling? 

Senator Sullivan. Yes, sir; as I understand the grain business you have 
struck a very vital point. Grain comes into the country elevator, and it is not 
cleaned and it is not cooled and it has nothing to do with it. It is sent finally 
to the great terminal elevators, and there it is cleaned and treated. 

I was a member of the grain investigating committee of the Senate at the 
last session, and we had that very proposition up. The grain that comes into 
Minneapolis necessarily is in an elevator. The elevator charge is a fixed 
charge, and if you put your wheat into the elevator and simply let it run out 
into another car, your charge is the same as if you had 10 days’ storage and 
go through all this process of cleaning. So I do not think the canal wheat 





220 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


ought to be charged, except on a very small percentage of the wheat going 
toward Duluth, with any other charge than the difference between the trans¬ 
portation by canal and the transportation by railway. 

If the board will permit me, I will tile with the board later a printed state¬ 
ment supplementary to the one that has been filed, including data which has 
come to our hands since the printing of the statement. 

Col. Black. Very well. 

Col. Newcomer. When may we expect that, Senator? 

Senator Sullivan. I think I can have that here inside of two or three weeks. 
Is that time enough? 

Col. Newcomer. Oh, yes. You may suit yourself about that, largely. 

Senator Sullivan. There have been some changes of rates and other condi¬ 
tions which I want to call the attention of the board to in the supplemental 
statement, and one of these statements is a very important one. It is on 
flour. One dollar and sixteen cents is the rate for the shipment of flour east of 
Duluth. The discussion in the local board’s statement hangs upon the theory 
that it is $1; and there are other vital questions of that character that I 
think ought to be taken into consideration by the board. And perhaps I can add 
to that supplemental statement a more particular statement of our position with 
reference to cooperation in the matter. 

I want to thank the members of the board for your kind attention to me 
during my long talk this morning. 

Col. Black. We have been very glad to have you here. 

STATEMENT OF MR. F. N. STACY, STATISTICIAN OF THE MINNESOTA 

COMMISSION. 

Mr. Stacy. I should like to get at the points upon which your board desires 
data. I judge by your questions this morning that you desire, first, data in 
regard to tonnage during the summer months of lake navigation? 

Col. Black. Yes. Those totals are not for annual movements. We want 
to know how much can be expected in the summer months. 

Mr. Stacy. In regard to flour and grain and coal, and so on? 

Col. Black. Yes. 

Mr. Stacy. And, second, you want further data on the benefits locally and 
generally; and third, you would like further data on the subject of the barge 
type and capacity for a 6-foot canal? 

Col. Black. Yes. 

Mr. Stacy. And, fourth, do you require any further data on the subject of 
transportation cost and handling cost on such products, or have you sufficient? 

Col. Black. I can not say. I have not studied it enough. 

Col. Newcomer. The board has not yet gone over this carefully, so they 
can not tell about that. 

Mr. Stacy. Fifth, I suppose you would like data in regard to methods and 
practices with reference to rail shipment as compared to water shipment. I 
suppose that whatever data you could get on that would be acceptable? 

Col. Black. I do not think you could get any that is not at our disposal 
now. It would be merely speculative in this case. 

Mr. Stacy. Our data so far simply comes down to the year 1912. We could 
carry it forward, I suppose, to the close of 1913 if it is desired by this board. 

If there are any other points desired, I would like to hear from the board. 

Col. Black. These offers of cooperation have been very general, and I only 
want to bring to the attention of you gentlemen that the question of coopera¬ 
tion has come in many cases previously that would not otherwise have been 
recommended if it had not been for offers of local cooperation. 

Senator Sullivan. I came here to represent the State of Minnesota and its 
commission, and the State of Wisconsin and its commission. The Wisconsin 
commission are present, but represented by me so far as any statement is to 
be made. And I also represent the commercial bodies of Minneapolis and St. 
Paul. 

STATEMENT OF HON. C. R. DAVIS, REPRESENTATIVE FROM THE THIRD 
CONGRESSIONAL DISTRICT OF MINNESOTA. 

Mr. Davis. Mr. Chairman and gentlemen, I will not detain you to exceed 
two or three minutes. I could not, if I desired to do so, put any statistics 
before you that would be of any more value to the board than the statement 
made by Senator Sullivan. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 221 


I represent the district in which the Minnesota Valley, the heart of Minne¬ 
sota, is contained, surrounding the Twin Cities, taking in a portion of St. 
Paul, extending to Washington County, to the east of St. Paul and Minne¬ 
apolis and surrounding Minneapolis. 

I have lived in Minnesota—I was going to say, longer than anybody. I was 
there before it became a State. I have seen the navigation by the so-called 
Minnesota River, which furnishes some of the water for the Mississippi. I am 
at the junction. I am a waterway advocate. My terms in Congress for 12 
years have demonstrated, however, this fact, that the money expended here¬ 
tofore upon waterway projects, at least a great deal of it, has been uselessly 
expended, I believe. 

I agree to a large extent with Senator Burton. In all matters of this kind, 
however, I think the engineering board, while they are perhaps limited to 
exact statements as to what ought to prevail, yet I believe this board is 
endowed with a little of the same discretionary power that courts are; and 
upon that point I wish to say a few words. 

You know that certain rivers, like the Tombigbee and others, have been 
provided for with reference to future tonnage, etc. This is the only vital con¬ 
necting link between the Great Lakes and the Gulf. 

I heard your cross-examination of Senator Nelson, whom I have known ever 
since he came to Minnesota, and I wish you could have continued further. I 
wish to say this, that, even if this board could not at the present time figure 
out a good substantial dividend on behalf of this waterway project, still it is 
as it were the beginning of a system of waterways which, in my judgment, is 
the all-important one, down the great Mississippi Valley, 1,500 or 2,000 miles 
from the Gulf to the Lakes, and about 1,500 between the Alleghenies and the 
Rockies, containing the heart and center of this continent from a productive 
standpoint and a standpoint of policy; and were I an engineer I should 
figure on the country that is tributary to this main artery, this main canal 
which ultimately will almost belittle the great Panama Canal, and the build¬ 
ing of this canal should be the hope of the engineering board from this time 
forth. This productive part of our continent should be encouraged, even if 
temporarily for the next two, four, or six years it should not be a paying 
proposition. 

The head of the Great Lakes at Duluth, for instance, should be the starting 
point, even if the St. Croix River and the canal should not in the first four or five 
years pay. There should be a good beginning for this ultimate grand ending, 
for the heart and center of this continent. 

I ascertained from the figures submitted this morning that perhaps it will 
not pay quite 3 or 4 per cent, but my experience is that while you can not 
figure immediately any actual percentage, ultimately and within a few years 
it is going to pay a large percentage. It is not wholly for the States of 
Minnesota and Wisconsin; it is for the entire great Northwest, the great 
wheat-producing country, the great Mesabi Range, the great steel works that 
are about to be developed and will he soon developed; for the coal, lumber, 
iron, grain, etc., that are produced in that great territory. 

I will state that every place that you put in a canal, and especially of this 
iind, you are bound to reduce freight rates and thus inure to the benefit of the 
whole country. 

My point is that you ought not, in my judgment, to figure down to the last 
cent of percentage that will he made immediately upon the construction of this 
canal, because the increase is so great that ultimately, and very soon, you will 
reap the benefit many fold, even if you can not see it for the next four or five 
years. That is the point I desire to leave with you. 

Having lived there almost 60 years, right in the heart of this country, and 
knowing the conditions, I think that that canal will be of very great benefit not 
only to that territory but the country at large. 

I thank you, gentlemen, for your attention. 

Senator Sullivan. There was a mistaken impression. Our figures show abso¬ 
lutely that we will realize more than 3£ per cent on the investment and cost of 
maintenance from the very day it is constructed. Our figures show that mer¬ 
chandise can be hauled at rates so much less that 3£ per cent will be saved and 
the low cost of operation required by and atfked for by this board will be realized. 

I simply wish to say that if the board can find its way clear to recommend 
it on the broad proposition, and owing to our location, it ought to prevail. The 
board ought to give us the benefit, and the absolute benefit, under those cir- 


222 WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 


cumstances. I think this project should receive as much meritorious attention 
as any project I have ever heard of in 12 years—in all my river and harbor 
work. 

Col. Black. Gentlemen, we are very much obliged to you. 

STATEMENT OF MR. JAMES L. COWLES, PRESIDENT AND TREASURER OF 

THE WORLD POSTAL LEAGUE. 

Mr. Cowles. Are you closing your hearing at this present time? 

Col. Black. We should have closed the hearing on this subject at 11.30. 
There are some other gentlemen present who wish to address us on other 
subjects. 

Mr. Cowles. I want to present some different views, if you please. Do you 
prefer that I should do that later? 

Col. Black. No ; we would rather go ahead now. 

Mr. Cowles. I am from the State of New York, and I have devoted about 
24 years to the study of transportation problems in this country. I want to 
say a word in reference to the Erie Canal. When this new barge business was 
up I gave considerable study to it, myself, and I remember very well the articles 
published in the Railway Gazette by one of the leading engineers of this 
country, I think, of the Troy Polytechnic Institute. I can not remember his 
name. 

Col. Abbot. Was it Mr. Sweet? 

Mr. Cowles. I think not; but the article was in the Railway Gazette of that 
time, in which he showed that the business could be done more cheaply by rail 
than by the canal. The whole trouble is this: We have got our railways, but 
if I had my ideas carried out, if we were going to have another route it would 
have been to spend the money on an electric railway that would run every day 
in the year, and I would have had that railway run by electricity furnished by 
water from Niagara Falls or something of that kind. 

Gentlemen, to my mind, we must realize that the railways, trolley lines, 
auto and air lines, steamboat and steamship lines, telegraph and telephone 
lines are the nervous system of the body politic, and the solution of this problem 
is to be worked out through Government ownership of all of these great busi¬ 
nesses and in no other way. 

I believe that we are going to lose $100,000,000 on the canal in New York. 
For half a year, very nearly, it will not be of any use to us whatever. The 
stuff that goes out of the canal has to be brought there by rail to it, and then 
taken by rail from it; and if the Government owned the transportation routes 
and ran them you would do that business at less money, I believe, than could 
ever be done by private parties. We have expended and wasted enormous 
amounts of money upon this business. Samuel Fowler, one of the efficient 
engineers of New York, testified not long ago that in the mere matter of im¬ 
proved terminal facilities the cost would be cut from 75 cents to 19 cents a 
ton; and Mr. Fowler estimated that the cost by rail for the average of 135 
miles was only 40 cents. 

I desire to leave with you this little bit of a pamphlet which will bring out 
some of those points. It says that on the carload freight, 60 per cent of all 
freight, handling ore on the Great Lakes, if the whole railroad business were 
handled by the Government, could be done for 44 cents a ton. Substituting 
mechanical appliances for man power, the terminal expenses would be only 
19 cents, and whole total cost would be 59 cents a ton. 

In the first place, you must bear in mind that every competitive effort is a 
waste of business energy if that business can be done by one line running from 
Duluth to the cities of Minneapolis and St. Paul. You are going to build 
another line, and that is just so much labor lost. 

Cooperation is the law of human advancement. We have been wasting and 
wasting all these years by this whole system of competition. 

The trouble with our railways is that they never make their rates according 
to the cost of the service, but on the basis of how much ’the traffic will bear. 
Always and forever that luis been their policy. Bring all these railways to¬ 
gether. Use the trolley lines wherever they will do the business best; use the 
steamboats and the steamships where they will serve best. 

Mr. Small. If I may interrupt the gentleman, I would like to say that the 
allotted time has passed. 

Col. Black. I am afraid it has, sir. 


WATERWAY FROM LAKE SUPERIOR TO MISSISSIPPI RIVER. 223 


Mr. Cowles. I will not take more than one minute more. 

So far as coal is concerned, you know and I know that the time is close at 
hand when there will not be a pound of coal handled by railroads. It will be 
transported by electricity and carried by electricity to the place where it is to 
be used, and the savings made in the by-products of coal will far more than 
pay the expenses. 

The thing we want to-day is Government ownership of these things and of 
all means of transportation, and that will enable us to handle these things at 
infinitely less cost than in any other way. 

It is but a waste, to my mind, to build canals that can only be used for one- 
half of the year, when you can put in good electric service at infinitely less cost. 

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